Using IIS7 as a reverse proxy
Solution 1:
I suggest reversing things. You will have far less trouble by running Apache on port 80 and having it perform the proxy duties, with IIS on 8080.
Solution 2:
Eric, this is an old question now but I'll leave an answer on the ARR option for future readers. To redirect based on the host headers, use {HTTP_HOST} in the Conditions section. ARR supports redirect logic based on all server variables, so you have plenty of flexibility (as much as mod_proxy).