It isn't required, but might not be a bad idea to uninstall the driver for the old card before you remove it. Look for one listed in Control Panel, Add/Remove Programs. If it's not there, don't worry about it.
Other than that, turn the computer off, remove the old card, replace with the new one.
Regarding .NET framework:
1) It is fine to have both versions of framework installed. While most applications developed for 1.1 should be backwards compatible with 2.0. they will use 1.1 instead where present. This can only help.
2) If you don't have any software using .NET framework, you don't need either version.
It doesn't hurt to have one or both, but I am not sure Microsoft made the right decision distributing it through Windows update -- software that requires the framework usually installs it automatically or at least tells you to install it. Putting it on WU, to get it on most Windows computers whether needed or not, looks like a political move (to increase developer acceptance).
