Dedicated application pool is required for IIS remote admin & Webmatrix publishing.

First log in WebsitePanel, navigate to Hosting Space - Web Sites

Select Website you want to add user for web deployment service, click Management tab.

Type Username & password and Enable management service.

If website uses database, make sure you create database and user in WebsitePanel.

Enable Web Publishing and Re-build Publishing Profile.

Web Deploy settings:

Server: Server Name in Remote Management tab
User name: remote user created above
Password: password of remote user
Site name: your-website-domain.com
Destination URL: http://your-website-domain.com

Sample Publishing profile XML

Replace yourdomain.com and username/password with details of your hosting account.

<?xml version="1.0" encoding="utf-8"?>
<publishData>
  <publishProfile
  profileName="Web Deploy"
  publishMethod="MSDeploy"
  publishUrl="https://your-server.com:8188"
  msdeploySite="your-domain.com"
  userName="remote-user"
  userPWD="remote-user-password"
  destinationAppUrl="http://your-domain.com"
  SQLServerDBConnectionString="server=sqlsvr;uid=user;pwd=sqlpwd;database=dbname"
  mySQLDBConnectionString="server=yourdomain;uid=user;pwd=sqlpwd;database=dbname"
  hostingProviderForumLink="http://cp.premiumwebserver.com"
  controlPanelLink="http://cp.premiumwebserver.com"
  />

  <publishProfile
  profileName="FTP  Deploy"
  publishMethod="FTP"
  publishUrl="ftp://your-domain.com:21/your-domain.com/wwwroot"
  ftpPassiveMode="True"
  userName="ftp-user"
  userPWD="ftp-pwd"
  destinationAppUrl="http://your-domain.com"
  SQLServerDBConnectionString="server=sqlsvr;uid=user;pwd=sqlpwd;database=dbname"
  mySQLDBConnectionString="server=yourdomain;uid=user;pwd=sqlpwd;database=dbname"
  hostingProviderForumLink="http://cp.premiumwebserver.com"
  controlPanelLink="http://cp.premiumwebserver.com"
  />
</publishData>