Microsoft .NET Framework 3.5
Microsoft .NET Framework 3.5 contains many new features building incrementally upon .NET Framework 2.0 and 3.0, and includes .NET Framework 2.0 service pack 1 and .NET Framework 3.0 service pack 1.
I don't know about the version included in windows 7 but if you download and install Dot Net Framework 3.5 for XP it installs Dot Net 2.0, 3.0 and 3.5. Dot net framework 1.0 is a separate download. I wouldn't uninstall any of it. I have a couple of programs that specifically look for Dot Net 2, one of them I think is the Nvidia control panel.