Include a php file that is above WP installation hierarchically?

OK. I’m assuming you have WordPress setup as a sub-directory of your root URL. If so, this should work:

<?php include 'http://www.site.com/file.php'; ?>

Sometimes people write the include special form with parentheses. In most cases it won’t break anything, but if your code looks like this, try removing them:

<?php include('http://www.site.com/file.php'); ?>

Also, make sure that the “WordPress Address” and “Site Address” are both set to the proper URL in the admin settings. This might throw off your absolute URL.