This behaviour is not specific to ieeetran.bst, but also occurs with, e.g., the plain style. LaTeX uses the thebibliography environment to typeset the "References" section. thebibliography in turn uses the generic list environment, and lists by default add vertical space between (bibliography) items. To remove the spacing, one must add \itemsep 0pt at the right place of the definition of \thebibliography. (In the following example, I use the etoolbox package to selectively change the definition.)
EDIT: As you didn't reveal your document class, I'm assuming a standard class here, or at least a class with a "standard" definition of the thebibliography environment.
EDIT 2: In response to your revised question: Here's how to use the ieeetran class with the options compsoc and conference (sic!), but without enlarged vertical space between bibitems.
\documentclass[compsoc,conference]{ieeetran}
% \usepackage{etoolbox}
% \patchcmd{\thebibliography}{\leftmargin\labelwidth}
% {\itemsep 0pt \leftmargin\labelwidth}{}{}
\def\IEEEbibitemsep{0pt plus .5pt}
\begin{filecontents}{\jobname.bib}
@misc{A01,
author = {Author, A.},
year = {2001},
title = {Alpha},
}
@misc{B02,
author = {Buthor, B.},
year = {2002},
title = {Bravo},
}
@misc{C03,
author = {Cuthor, C.},
year = {2003},
title = {Charlie},
}
\end{filecontents}
\begin{document}
\nocite{*}
\bibliographystyle{ieeetran}
\bibliography{\jobname}
\end{document}
(The filecontents environment is only used to include some external files directly into the example, so that it compiles. It is not necessary for the solution.)
compsocconfoption. – Chan Li Aug 16 '11 at 13:25