Question: Where would the physical files be?

Answer: 
It depends on the OS and whether or not roaming user profiles are enabled.

For example, on XP, with non-roaming profiles, the location is

```
<SYSTEMDRIVE>\Documents and Settings\<user>\Local Settings\Application Data\Microsoft\IsolatedStorage 

```

On Vista with roaming profile storage,

```
<SYSTEMDRIVE>\Users\<user>\AppData\Roaming\Microsoft\IsolatedStorage

```

See an [Introduction to Isolated Storage](http://msdn.microsoft.com/en-us/library/3ak841sy.aspx) for more info.
I've also seen it under `%ProgramData%\IsolatedStorage` (so often C:\ProgramData\IsolatedStorage).

This particular case was a Windows Server 2008 with IIS site-related data.