I've often seen situations similar to this related to corruption in the installed .Net installation. Martineau's suggestion of uninstalling and reinstalling the .Net is probably in the right ballpark.
You can get this error with the .Net still installed if the program throwing the error does not DETECT the installation. Uninstalling/reinstalling will help with that. After you've uninstalled the existing .Net package, you might read through this article about the most recent Cleanup utility from MS. If removal of some other application left corrupted system connections, you might need that cleanup in order to get your system back to rights.