I disagree. It kept the .NET brand strong by having all the programming libraries be a part of .NET.
.NET 3.5 is a superset of 3.0 which is a superset of 2.0. It's not entirely intuitive, but it's very simple once you're told.
When I ask someone what version of the framework he has installed, it tells me everything I need to know - I don't have to ask "Well, in addition to .NET 2.0 do you also have WinFX? How about the LinqFX?". The version number says it all.