If you're using the Windows Installer project in VS.NET, add the output of your project to the installer and it is updated whenever you recompile your C# project (it becomes a dependency of the installer project). I'm not saying the GAC doesn't work, I'm just saying that it can lead to problems until you're done testing. You've already had one. If you use automatic versioning you'll have lots of assemblies (differing only by version) in your GAC. It doesn't hurt anything, but it sure clutters up the GAC. It's just a recommendation that's not uncommon when debugging applications, especially in larger teams.
Microsoft MVP, Visual C# My Articles