http://forums.iis.net/t/1166043.aspx

You can tell IIS to only look for web.config files at the root of virtual directories (no sub dirs) by setting allowSubdirConfig=false the vdir in question, or globally for all vdirs.  This command will set it globally:

c:\windows\system32\inetsrv\appcmd.exe set config -section:system.applicationHost/sites /virtualDirectoryDefaults.allowSubDirConfig:false /commit:apphost

You might have to re-start W3SVC to make it work.  

Hope that helps things.  It doesn't eliminate the web.config accesses but should decrease them significantly.