I apologize in advance for the length of this post. I wanted to get as
much detail as possible in here.

We have 1 web app that contains the functionality to do some single
sign-on logic. The flow is

1. Welcome page
2. Login Page (where the SSO actually occurs)
3. Welcome page
4. Default page

We have a separate web app that also needs to use the SSO
functionality, so rather than duplicating it, it redirects to the
pages within the first app. So the workflow for the second app
becomes

1. Welcome page (App #2)
2. Login Page (App #1 - where the SSO actually occurs, but this time
passing a return URL)
3. Welcome Page (App #1 - still passing the Return URL)
4. Return URL (App #2)

Everything is fine with the first app by itself. Essentially, the last
line in that page is

Response.Redirect("~/Login/Welcome.aspx");

and this works fine. In the second scenario, since the return URL is
being passed, the line becomes

Response.Redirect("~/Login/Welcome.aspx?ReturnURL=http://App2/
default.aspx");

This generates an application error with a message of

"/App1/Login/~/Login/Welcome.aspx?ReturnURL=http://App2/default.aspx"
cannot be found.

So it looks like it sees the '~' as a literal part of the path and
does not actually resolve it correctly in the second scenario. It
looks like it assumes that it needs to append the relative path to the
front of the URL passed to Response.Redirect. If we use
Server.Transfer instead, it works just fine. Does anyone know why this
is the case?