The namespace you should register is "Telerik.Web.UI". I think that you only need the Telerik.Web.UI.dll assembly in the WSP file. The new Prometheus controls do not have a RadControls folder since all skins and scripts are embedded in the assembly.
I think that WSS 3.0 is running on .NET 3.0 so you cannot use the assembly from the bin35 folder, because it is compiled against .NET 3.5. You will need the Telerik.Web.UI.dll assembly from the bin folder. In addition you need to make sure that ASP.NET Ajax 1.0 is installed on the server as well.
If you are trying to use the editor or spell controls, then you will also need to pack the App_Data folder since it contains the dictionaries for the spellchecker.
All the best,
the Telerik team