My team is looking into upgrading our large-ish C# solution (~30 projects, probably thousands of files) from VS 2005 to VS 2008.
From your experience, what problems, if any, are likely to appear?
Oh yeah, there are a few isolated components still using VS2003 that should also be upgraded to VS2008.
There will be no problems going from VS2005 to VS2008. .NET 3.5 is just .NET 2.0 SP2 with some additional assemblies (that your existing code, naturally, doesn't use).
The VS2003 is a different story. There were a number of bug fixes in .NET 2.0, and some of them "broke" .NET 1.1 (that is, .NET 1.1 was wrong, and things are "right" now).
As John said, expect very few problems. When I upgraded my projects, just to be safe I made sure the "target framework version" was set to .NET 2.0, then I rebuilt them under 2008/.NET 3.5 and pushed an update out.
Once I was happy everything was still working, I updated the target framework version to 3.5 and carried on working as normal, then pushed those updates out once they were ready.
An obvious footnote: if you use ClickOnce, make sure that the target machines all have .NET 3.5 on before updating the ClickOnce projects to use 3.5 as they won't even load under .NET 2.0. Not sure if this is the case for the apps but I'm guessing so.