I have an application in ASP which works fine on SQL server 6.5 but when I
move to SQL 7.0 I get all kinds of problems with the dates, I am using the
european dateformat dd/mm/yy and I have the server configured to the spanish
language, just as I did with the 6.5, yet a lot of the scripts give me date
errors.

Have you gone through the migration checklist?  When I migrated from 6.5 to 7, the entire application came to halt.  After several hours of analysis and testing, I found out that the language setting in SQL 7 was not the same as that of 6.5 causing problems in any unicode characters stored in the database.  I have the rebuild the MASTER database and set the proper language setting.

I have the same language setting.
Where is the migration checklist?

Have you gone through the migration checklist?  When I migrated from 6.5 to
7, the entire application came to halt.  After several hours of analysis and
testing, I found out that the language setting in SQL 7 was not the same as
that of 6.5 causing problems in any unicode characters stored in the
database.  I have the rebuild the MASTER database and set the proper
language setting.