These were the easiest instructions for me to follow
http://www.timefold.com/osx/tips/webdavical.html
There was a syntax problem with the httpd.conf file. The Directory and LimitExcept tags need to be closed. So, it should be
# WebDAV folder
<Directory "/Library/WebServer/Documents/dav">
DAV On
AuthName 'WebDAV'
AuthType Basic
AuthUserFile /etc/apache2/.htpasswd
AuthGroupFile /dev/null
<LimitExcept GET HEAD OPTIONS>
require valid-user
</LimitExcept>
</Directory>
Hope this helps somebody.