The entire WPF blogroll is in on it. .NET Framework 3.5 will be open source based on the MS-Reference License. The gist of the license is imagine the Framework source is a rare book in an antiques library. You’re free to look and discover. It just remains in the library.
In the interest of not just being a parrot here are my additional contributions to the topic. One of the biggest losses to me in the transition from VS 6.0 to VS .NET was the loss of the ability to dive into the Runtime Source while debugging. While I never found a bug in the runtime itself, I was able to discover just what happened that caused my code to act weird.
Having this ability restored is good for both Microsoft and us as developers. As developers, we will be able to get more insight into what ails us (or our code). If we happen to find an actual bug within the framework, we can report it easier. Of course Microsoft will receive benefits, not just from the bug reports, but also from the user potentially having more knowledge of just what is going wrong before they call. This results in quicker help for issues, which lets developers get past their impediments and move on to their next task quicker. As Scott mentioned, it might encourage exploration, giving developers a richer knowledge of how the framework ticks. This results in code that is better in sync with the framework. Which also results in less support calls. The savings Microsoft realizes will enable them to divert more of their finances toward other projects. Like bringing world peace and renewing the human race.