Had a similar problem to this one, wherein the SharePoint Timer service appeared to be screwing around with my app pool settings for my SSP web application.
Not entirely sure what caused it (because I wasn’t taking notes – trying to set this one up quickly) but I found the problem while trying to set a trusted location for Excel Services.
The big bold black “Service Unavailable” kept balking me. I kept double-checking passwords (I only use one password in Dev environments), Web Application Policies, the Server Farm Administrators’ group and AD Security Group memberships to no avail.
For me, trying to set a new App Pool and App Pool Identity didn’t in fact work when trying it with IIS Manager. The Timer Service appeared to keep messing me around.
What did finally work was using the Service Accounts settings in Operations Manager of SharePoint Central Administration.