htaccess file preventing access to site

Background:

I have a hosting account with GoDaddy and I am hosting four websites. One is running Wordpress, two are using Drupal, and one is just an HTML site. After installing Drupal for the second site I got this error while trying to access the HTML site:

Forbidden
You don't have permission to access / on this server.
Additionally, a 500 Internal Server Error error was encountered while trying to use an ErrorDocument to handle the request.
Apache/1.3.33 Server at www.bentleypontoonboatsonline.com Port 80

The guys at GoDaddy said it was my htaccess file that was causing this, but could offer no help as to how to solve it. If I change the name of the htaccess file to something else, the HTML site works and the homepages on the Drupal site work, but any links in the Drupal site say the page cannot be found.
The Wordpress site is not effected either way.

The HTML uses the root folder (where the htaccess file is) and the other sites use sub folders.

I am not sure what the htaccess file does. Can anyone help me?

Here is the htaccess file:

#
# Apache/PHP/Drupal settings:
#

# Protect files and directories from prying eyes.
<FilesMatch "\.(engine|inc|info|install|module|profile|po|sh|.*sql|theme|tpl(\.php)?|xtmpl)$|^(code-style\.pl|Entries.*|Repository|Root|Tag|Template)$">
  Order allow,deny
</FilesMatch>

# Don't show directory listings for URLs which map to a directory.
Options -Indexes

# Follow symbolic links in this directory.
Options +FollowSymLinks

# Make Drupal handle any 404 errors.
ErrorDocument 404 /index.php

# Force simple error message for requests for non-existent favicon.ico.
<Files favicon.ico>
  ErrorDocument 404 "The requested file favicon.ico was not found.
</Files>

# Set the default handler.
DirectoryIndex index.php

# Override PHP settings. More in sites/default/settings.php
# but the following cannot be changed at runtime.

# PHP 4, Apache 1.
<IfModule mod_php4.c>
  php_value magic_quotes_gpc                0
  php_value register_globals                0
  php_value session.auto_start              0
  php_value mbstring.http_input             pass
  php_value mbstring.http_output            pass
  php_value mbstring.encoding_translation   0
</IfModule>

# PHP 4, Apache 2.
<IfModule sapi_apache2.c>
  php_value magic_quotes_gpc                0
  php_value register_globals                0
  php_value session.auto_start              0
  php_value mbstring.http_input             pass
  php_value mbstring.http_output            pass
  php_value mbstring.encoding_translation   0
</IfModule>

# PHP 5, Apache 1 and 2.
<IfModule mod_php5.c>
  php_value magic_quotes_gpc                0
  php_value register_globals                0
  php_value session.auto_start              0
  php_value mbstring.http_input             pass
  php_value mbstring.http_output            pass
  php_value mbstring.encoding_translation   0
</IfModule>

# Requires mod_expires to be enabled.
<IfModule mod_expires.c>
  # Enable expirations.
  ExpiresActive On

  # Cache all files for 2 weeks after access (A).
  ExpiresDefault A1209600

  # Do not cache dynamically generated pages.
  ExpiresByType text/html A1
</IfModule>

# Various rewrite rules.
<IfModule mod_rewrite.c>
  RewriteEngine on

  # If your site can be accessed both with and without the 'www.' prefix, you
  # can use one of the following settings to redirect users to your preferred
  # URL, either WITH or WITHOUT the 'www.' prefix. Choose ONLY one option:
  #
  # To redirect all users to access the site WITH the 'www.' prefix,
  # (http://example.com/... will be redirected to http://www.example.com/...)
  # adapt and uncomment the following:
  # RewriteCond %{HTTP_HOST} ^example\.com$ [NC]
  # RewriteRule ^(.*)$ http://www.example.com/$1 [L,R=301]
  #
  # To redirect all users to access the site WITHOUT the 'www.' prefix,
  # (http://www.example.com/... will be redirected to http://example.com/...)
  # uncomment and adapt the following:
  # RewriteCond %{HTTP_HOST} ^www\.example\.com$ [NC]
  # RewriteRule ^(.*)$ http://example.com/$1 [L,R=301]

  # Modify the RewriteBase if you are using Drupal in a subdirectory or in a
  # VirtualDocumentRoot and the rewrite rules are not working properly.
  # For example if your site is at http://example.com/drupal uncomment and
  # modify the following line:
  # RewriteBase /drupal
  #
  # If your site is running in a VirtualDocumentRoot at http://example.com/,
  # uncomment the following line:
  # RewriteBase /

  # Rewrite URLs of the form 'x' to the form 'index.php?q=x'.
  RewriteCond %{REQUEST_FILENAME} !-f
  RewriteCond %{REQUEST_FILENAME} !-d
  RewriteCond %{REQUEST_URI} !=/favicon.ico
  RewriteRule ^(.*)$ index.php?q=$1 [L,QSA]
</IfModule>

# $Id: .htaccess,v 1.90.2.1 2008/07/08 09:33:14 goba Exp $
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