.NET Framework Libraries Source Code - License - MS-RL
When I first read Scott's post, I missed the Microsoft Reference License (Ms-RL) which the .net Framework libraries is released under.
The key thing to remember is this:
"Reference use" means use of the software within your company as a reference, in read only form, for the sole purposes of debugging your products, maintaining your products, or enhancing the interoperability of your products with the software, and specifically excludes the right to distribute the software outside of your company.