Server :: Nginx Virtual Hosts & Wordpress Rewrite Rules?

I'm trying to set up my web server (nginx) as a catchall virtual host, as per an example that can be seen here: [URL].. (It's the Wildcard Subdomains in a Parent Folder example). Now, here's my issue. I use Wordpress on the coburndomain.org domain. I have pretty URLs enabled, that make my Wordpress articles look like this:[URL].. At the moment, nginx is reporting 500 Errors, saying that index.php is not a directory. What I want to do is make a rewrite rule that allows me to use the above URL example with nginx.

I followed this tutorial to do so: [URl].. , but I'm not sure how to apply it to my setup. Here's my configuration files from Debian Squeeze with Nginx onboard:

[Code]...