Apache rewrite rules inside a virtual host - apache

Question

I'm having some trouble with migrating my rewrite rules from .htaccess to a VirtualHost.
When I'm using below Directory outside the VirtualHost it works, but I get some authentication errors - so I'm wondering to what I should change it to make it work inside the VirtualHost.
Or should they be added to <Directory /var/www/server/>
Rules:
<Directory /var/www/server/subfolder/>
RewriteEngine On
RewriteCond $1 !^(index\.php|images|js|css|robots\.txt)
RewriteRule ^(.*)$ /subfolder/index.php/$1 [L]
</Directory>
VirtualHost:
<VirtualHost *:80>
ServerAdmin admin#server.com
Servername server.com
ServerAlias server2 server2.com server server.com
DocumentRoot /var/www/server
<Directory />
Options FollowSymLinks
AllowOverride None
</Directory>
<Directory /var/www/server/>
AuthType NTLM
AuthName Server
require valid-user
PythonAuthenHandler pyntlm
PythonOption Domain SERVER.COM
PythonOption PDC xxx.xxx.xxx.xxx
PythonOption BDC xxx.xxx.xxx.xxx
Order allow,deny
Allow from all
</Directory>
ErrorLog ${APACHE_LOG_DIR}/server.com_error.log
# Possible values include: debug, info, notice, warn, error, crit,
# alert, emerg.
LogLevel warn
CustomLog ${APACHE_LOG_DIR}/server.com_access.log combined env=!nolog
</VirtualHost>
Thanks in advance.

Answer 1

What fixed the authentication issue for me was to add
Order allow,deny
Allow from all
to the existing <Directory /var/www/server/subfolder/>.
Though I still only managed to get it to work when having <Directory> outside of <VirtualHost>.
Thanks all.