That's Not ASP!
File I/O with traditional ASP was accomplished via the FileSystem object. This object provided a lot of the same functionality I described today. ASP.NET comes with access to all the .NET Framework classes, which means that unlike traditional ASP, ASP.NET can perform the same file I/O operations as any standalone application.
Luckily, many of the concepts and even syntax are the same in ASP.NET as they were in traditional ASP. A few of the object names have changed, and some of the behind-the-scenes functionality is different, but developers familiar with the FileSystemObject shouldn't have many problems moving to the new paradigm.
Among the most significant changes is the move to a completely object-oriented design. Each file and directory can be represented with an object in the .NET Framework, and each of these objects provides its own methods, properties, and collections of additional objects. It might take some time to get used to using these tightly related objects as opposed to the loosely structured menagerie that was the FileSystemObject.
Including files is also a bit different in ASP.NET. Because of the way ASP.NET interacts with the .NET Framework, it is essential to include information from other files in your applications. The traditional method of server-side includes is still provided, but there are now many other ways to include files to extend your ASP.NET pages.
The argument for using isolated storage versus databases is a bit more indistinct. The mechanism you use will often depend on the situation and server configurations. Nevertheless, both methods are useful mechanisms for persistent data storage.