assembly registration?

Hey all,
I have created an app in vb.net that targets the 3.5 framework and have created a setup & deployment app for it in vs2008. This app references 3 third party dll assemblies. One of the assemblies target the framework v1.1, another targets v2.0 and the third targets v3.5.

Q1) Is having v 3.5 installed on the target machine enough for all assemblies or are the other frameworks required?

I would not like these assemblies installed into the application directory so in the setup project, I have configured each assembly to install into the system folder (and have confirmed they are installing into ..\system32). I am not sure about what to set the Register property so I have tried both vsdraCOM and vsdraCOMRelativePath, but in both case, when I run the deployed application, an exception is thrown stating that "The system cannot find the file".

Q2) How do I successfully install assemblies so they are not in the application folder?
thanks
kevin