The error you are getting is not about an incompatible .NET framework version, it is about an incompatible Visual Studio version!
Visual Studio project versions are not linked to .NET versions. A Visual Studio 2008 project can target .NET 2.0 up to 3.5, but still you can't open a VS 2008 project with Visual Studio 2005, even though Visual Studio 2005 can create .NET 2.0 projects, too.
Having the latest .NET framework on your machine does not guarantee that you can open projects with the latest Visual Studio version in an older Visual Studio.
You can simply not downgrade Visual Studio projects easily. There are posts describing how to to it by modifying the project files, etc., but in general you can only upgrade projects using the wizard that's automatically opened by Visual Studio.