There needs to be better instructions on how to set up tracing of calls from a web server to other services. I've looked through all the documentation it makes it appear that this is as simple as setting the defaultProxy and viola, you'll get the server-to-server traffic to you so desperately need to see. Except that it doesn't work.
What has to be done is change the IIS App Pool so that the application runs in the same account as your using to run fiddler. Then all of the other things that need to happen still need to be changed (adding the Fiddler certificate, defaultProxy, etc.).