M$ have a migration wizard that does the upgrade from 1.1. to 2.0 and it reports on areas it struggles on. I did try this directly with my pet project and it seemed to convert the class files fine. There seem to be a fee issues I think it just comes down to how M$ .Net pure you wrote your application.
CodeBetter seemed to have no problems at all with their upgrade. The main advantages are performance enhancements, ADO.Net upgrades, full XHTML support, Visual Studio enhancements,  and the fact it's the future!

The main error I got was for most of my user controls which was:
ERROR: The following files were not migrated because they were not found in the project file or the associated 'BuildAction' is set to 'None'. You may need to exclude these files from the project after the conversion process in order to compile your web site
This was the 'old chestnut' where user controls would loose their mappings to their code behind files and didn't have a relationship between them. I double clicked on each user control and opened them in VS2003 and it remapped these.

Now I've got some teething problems though with regards to the:

• how it grabs configuration data from web.config;
• it moving files around and confusing Subversion (my version control)

Other than that, it worked fine! It allows me to use the 1.1 binaries for my URL rewriting that Scott Gu wrote and also the FCKEditor. But I'm sure I can take the time now to upgrade these to the 2.0 alternatives ;-) More work!...But atleast now I can start playing in VS2005 and with Atlas!
I must admit I did see a performance improvement on load times of the application.