I am facing a kind of similar situation on my installation which is based on:
When I do a clear/fresh installation of joomla (any version) on my server it works perfectly including SEF.
When I move my website from my previous server which is on iis and php+mysql I get "500 - internal server error" on my Frontend!
The back end works perfectly fine.
I have tried turning of SEF as well but no luck.
I have changed both user and group ownership on the transferred files from the previous server which has made all the requirements writable.
I am just not figuring out why this '500 - internal server error' appears! I would really appreciate it if anyone can guide me a little bit through.
Thank in advance