One of the things I do to allow easy on-boarding of developers is to put all referenced assemblies (Enterprise Library, Smart Client Software Factory, etc...) into a folder and add all the files as solution items.  This allows the developer to just pull the code from VSS or VSTS and start working without any other installs.  Currently, I am using the NetTiers CodeSmith template which generates an object layer from a database and integrates with Enterprise Library.  When I updated the NetTiers assemblies, I got this error above since the main project is deployed using ClickOnce.  After researching the problem, I found that cleaning out the bin and obj folders fixed the problem.