Edited Issue: Can't connect to private NuGet server after upgrading to 2.0: Unable to connect to the remote server [2368]

I can't connect to my private NuGet server after upgrading to 2.0.
The server is running NuGet.Server 1.8 and Windows Auth on IIS 7.0.

Here is my repro:

PS > .\NuGet_Old.exe | select -First 2
NuGet Version: 1.8.30507.9032
usage: NuGet <command> [args] [options]
PS > .\NuGet_Old.exe list -Source private
MyLib1 0.9.5.0
MyLib2 0.3.0
PS > .\NuGet.exe | select -First 2
NuGet Version: 2.0.30619.9000
usage: NuGet <command> [args] [options]
PS > .\NuGet.exe list -Source private
Unable to connect to the remote server