Hello G S S,
Thank you for using our services.
Can you please take a look at the following article - Sitefinity Installation: Error Creating Virtual Directory
, that is dealing with the same error you are getting. You might also need to turn on support for 32 bit applications in your IIS, as in the attached image.
The trial on Blank Project works as the trial on the Sitefinity installation. When you go to production a message will start appearing that you are running a trial version of Sitefinity, since you will not have a license key for this website. If your existing site is not on Sitefintiy you have to rebuild the site in your Sitefinity website. If the existing site is already built on Sitefinity you can export it from the Administration section and then create a new site from the exported one.
the Telerik team