When you register a isapi wsgi app, the user running it must have the
IIS permissions to create virtual directories etc. So any user who
creates isapi wsgi apps (it's the same for installing an ASP or .NET
app) would need these additional IIS permissions. They are not
something you would give a normal user.
Regarding stdout & stderr, suggest you read:
http://code.google.com/p/isapi-wsgi/wiki/UnderstandingISAPIWSGI
In the example section, it discusses enabling tracing in the app and
using an external win32traceutil python process as a console to
collect stdout/stderr.