Benefits of ASP.NET 2.0 include:

1) A wide array of new controls, such as GridView control, 
MultiView, Wizard and FileUpload.
2) Superior separation of design and content, enabling 
developers and Web designers to work together.
3) A new model for compiling and distributing applications.
4) Customization with Web Parts.

Bug in ASP.NET 2.0:-
If you have a control on a page that is marked Read-Only 
and EnableViewState is set to false on the Page, the 
ReadOnly value will no longer post back in ASP.NET 2.0 - 
the value gets lost. This even though the value is actually 
returned in the POST buffer.

This behavior is also different than 1.1 which (correctly I 
say) posted back the READONLY value.

Master Pages

Additional things in ASP.NET 2.0
1. Partial Class
2. Generics
3. New control like grid view,masterpage
4. More event in Page Life cycle
5. Incorporated Classic ASP style save functionality, no 
needs to compile each time for small modification

Asp.net 2.0 enhanced with many new features.

* Partial Classes
* Master pages
* Skins and Themes
* Roles and MemberProfiles
* Generics
* Added many new server contols like      
  GridView,DetilsView,FileUpload etc..,
* Web Personalization - Web Parts
* New Folders lime App_Browsers,App_Code,etc..,

In asp.net1.1 IIS should be installed by us.But in asp.net 
when install asp.net IIS automatically will be installed

In ASP.NET user have to install the IIS. But In case of 
ASP.NET 2.0 IIS is coming with the installation process. 
another facility is the master page which is in ASP.NET 2.o 
But not in ASP.net 1.1.

.NET 1.1 AS IIS installed and ASP.NET not supported to
crystal report.
.NET 2.0 As IIS dont Available and ASP.NET full supported.
.net 2.0 new tools for grid view and menu tree available.