I used the MS .net framework repair tool.
After the tool repaired my frameworks, all of them per the tools suggestion, I still could not open Paint nor delete framework, thus I could not re-install framework.
I re-applied the repair to 2.0 sp2 using control panel/add-remove programs/ repair on 2.0 sp 2 (which now worked after the tool repair).
Eureka, I now have my beloved paint back.
I hope this helps, good luck STj.