So there I was trying to use msdeploy to deploy a web site from Visual Studio 2010 into an IIS 7 server on another box using the "Build Deployment Package".
I got the error:
The package installation failed.
The application pool that you are trying to use has the 'managedRuntimeVersion' property set to 'v4.0'. This application requires 'v2.0'.
My web application used the "Default Web Site" and the application pool that it was connected to (DefaultAppPool) was .NET Framework 2.0. Yeah - I screw around with IIS a lot!
Of course, where I was deploying it to was the more usual .NET Framework 4.0.
Mr. Google to the rescue and the answer is to set the following options under the project / Properties / Package/Publish Web:
You need to tick the two text boxes "Include IIS Settings" and "Include application pool settings".
And away you go with msdeploy.