I have just setup a wordpress MU install and just about everything appears to stay in working order. After i hit site.com/subsite i recieve a 404 on-site.com however when time passes to site.com/subsite/ (spot the trailing slash) everthing appears to operate fine.

the produced wordpress mod_rewrite code is

# BEGIN WordPress
RewriteEngine On
RewriteBase /
RewriteRule ^index\.php$ - [L]

# uploaded files
RewriteRule ^([_0-9a-zA-Z-]+/)?files/(.+) wp-includes/ms-files.php?file=$2 [L]

# add a trailing slash to /wp-admin
RewriteRule ^([_0-9a-zA-Z-]+/)?wp-admin$ $1wp-admin/ [R=301,L]

RewriteCond %{REQUEST_FILENAME} -f [OR]
RewriteCond %{REQUEST_FILENAME} -d
RewriteRule ^ - [L]
RewriteRule  ^([_0-9a-zA-Z-]+/)?(wp-(content|admin|includes).*) $2 [L]
RewriteRule  ^([_0-9a-zA-Z-]+/)?(.*\.php)$ $2 [L]
RewriteRule . index.php [L]
# END WordPress

any suggestions how i ought to adjust this or other configurations to prevent the 404s?

I have hit this problem regarding pages, but haven't used a multisite install with blogs classified by subpaths (only by different domain names).

However, it might be solved in the same manner:

Visit the Configurations -> Permalink admin page and customize the permalink structure to get rid of the trailing slash. For instance, whether it has got the default or among the presets selected, just duplicate the string in to the custom area, but without and trailing slash.

Wordpress will invariably problem a redirect from together (e.g. from http://example.com/ to http://example.com - or vice-versa if you have trailing slashes within the permalink structure)

I'm not sure why it's giving a 404 for the site.com rather than a 302 to site.com/ (possibly redirection towards the canonical URL is really a choice somewhere)

Hope that can help.