I haven't played with VC 2005 Express, so I'm not familiar with the differences between it and the full edition.
I had forgotten about the whole "We changed the version #, so all of the project files have to change format too" thing. This is really, REALLY frustrating, too, because all of the examples in the MSDN use the new file format, meaning that if you aren't using the latest edition of the compiler, you can't even open the examples!
Even MORE infuriating than that, though was the fact that Microsoft went through the online MSDN and changed all of the examples to use the VS 2005 format even before VS 2005 was RELEASED!
I ran into this shortly before VS 2005 came out. I fired off a nastygram to Microsoft about this and received a very nice response that basically boiled down to "We're very sorry you feel you were inconvenienced. Would you like a cookie?".