For Windows 7: Basic authentication for WebDav is disabled by default. To enable it, the following entry in the registry has to be updated to 2 or greater in the web client:
Possible values: 2 or greater - Basic authentication for SSL shares and non-SSL shares.
You need to reboot after changing the registry. See http://support.microsoft.com/kb/841215/en-us for more information.
In addition, you need to have a Windows user with the same credentials as the repository user, otherwise you will get permission problems.