Our old friend SelfSSl does not work in IIS 7.0. But it is easy enough to set up a certificate and use SSL. Here is the brief version:
Server Name > Server Certifications > Create Self-Signed Cert
Go to site > Right click > Edit Bindings > Add one for https with unused port
Select the cert you created.
Restart web site then click on the correct browser link for the port on the right
You will get a warning that the cert is unsafe, but you can continue to the site.
Here is a longer version if you get stuck:
http://learn.iis.net/page.aspx/144/how-to-setup-ssl-on-iis-70/
