I believe there might be problems with IIS Authentication in DirectoryEntry object. Can you please add
DirectoryEntry.AuthenticationType = AuthenticationTypes.Encryption
and see if your issue is resolved.
Starting Windows Server 2003 SP1, all remote IIS communication needs to be encrypted, else you will end with WBEM_ACCESS_DENIED from WMI. If this AuthenticationTypes is not working, try others from the below web page and let me know how it goes.
If the issue is still occurring, please try to restart the pool using WMI. Please refer my article