Now that Visual Studio “Orcas” finally has an official name, it’s time to clear up the new confusion surrounding the different versions of the .NET Framework that will be available.
Daniel Moth has an excellent post describing what he calls the Visual Studio 2008 stack that includes this graphic.
The important thing that can be seen from this slide is that the CLR engine is the same in v2.0, v3.0, and v3.5 of the Framework. The major difference is the language enhancements (C# 3.0 and VB9), while v2.0 and v3.0 of the Framework included the same language version as well.
The Visual Studio IDE changes going from VS2005 to VS2008 are more incremental than they were going from VS.NET2003 to VS2005. VS2008 is a superset of VS2005, so there will be little point in having them both installed, but it is possible and supported.