Hi Gosain,

Below is what Chris did. I hope it helps you:

In Options > System > Friendly URLs, I made sure it was enabled and used the following settings

Code:
File extension: .php
Prefix: /news/
Directory filename: index.php


The .htaccess file in your /htdocs/spyglasshill/ directory contains the following code

Code:
RewriteEngine On
RewriteCond %{REQUEST_FILENAME} !-f
RewriteCond %{REQUEST_FILENAME} !-d
RewriteRule .* /index.php [L]

And the final thing I did was edit your /htdocs/spyglasshill/index.php file, the css & javascript includes at the top of the file, I changed their path from a relative to an absolute path by prefixing the path with a / at the beginning. For example I changed this

Code:
<link rel="stylesheet" href="css/nivo-slider.css" type="text/css" media="screen" />


To this

Code:
<link rel="stylesheet" href="/css/nivo-slider.css" type="text/css" media="screen" />


As I said everything as far as I can see seems to be working as expected, if you run into any problems let me know.