Does .NET framework 3.5 include all prior versions?
3.5 is actually an extension of 3.0, which itself is an extension of 2.0.
The redistributable does not.
.NET 3.5 supports all of the .NET 1.0, 1.1, 1.2, 2.0, 3.0 codebase (although some things may be changed up a bit, marked obsolete, etc...).
But if you install .NET 3.5 you will need to install .NET 1.1 to run an app compiled against that CLR.
However, .NET 2.0, 3.0, 3.5 all share the same CLR so you may be able to run .NET 2.0 apps w/ the 3.5 redist, I'd have to test it to be sure.
It depends on what you mean.
.NET Framework 3.5 is a set of new assemblies added to .NET Framework 2.0.
.NET Framework 2.0 replaces .NET Framework 1.1
.Net 3.0 & 3.5 are considered "Additive releases" which means they are not decoupled from the version 2.0, but more an extension; version 3.0 and 3.5 still use CLR version 2. So consider version 3 & 3.5 just as version 2 + some (very valuable extra's)