Does IP or Domain name restriction work under IIS?

I have been told by some system administrators that IP/Domain Name restriction does not work under IIS. The system it was tried on was running Windows 2003 Server IIS version 6.x. When the domain name restriction was applied to the website it blocked all address from accessing the site. The system administrators say there was a work around which they tried but it did not work. Can anyone confirm a problem with IP/Domain name restriction under IIS?
Thanks

HOW TO: Restrict Site Access by IP Address or Domain Name

Setting Folder Security by IP Address or Domain Name
Apache uses the Allow and Deny directives to determine the sites that can access a particular Web site or folder. However, Apache provides discretionary access control; you must either deny all sites and provide a specific list of sites or IP addresses that can access a folder or allow all sites and deny only those sites that you do not want to have access. For example, if you use the following directive, all client computers are denied access unless they are recognized as part of the domain.com domain:

Deny from all
Allow from .domain.com

IIS works the same way. All clients are specifically denied or granted access, except for those that are listed.