If you have two WordPress websites. Primary WordPress site is abc.com and secondary is abc.com/wordpress. If you wish to configure secondary wordpress site to use “Post name” in Permalink Settings. You will be getting 500 - Internal Server Error on the secondary site (abc.com/wordpress).
http://abc.com/wordpress/sample-post instead of http://abc.com/wordpress/?p=123
The solution is simple:
1. Login to your control panel or FTP server. Find your web.config file from your primary domain and add below line to web.config file.
<?xml version="1.0" encoding="UTF-8"?>
<location path="." inheritInChildApplications="false">
This is to prevent your sub-folder from inheriting the web.config file from your primary domain.