Why this doesn't work is a mystery to me. Especially since it is included as part of the vhosts.conf file. Should I put the 'Include /etc/apache2/conf.d/*.conf' directive earlier in the conf file? Does the order make a difference?
BTW, if I copy the current index.php file on site1 to index.html the latter displays without the ssl decorations. However, the site still won't display any php files.