The Telerik RadControls for ASP.NET AJAX
suite is built on top of MS AJAX. Hence, for it to run, MS AJAX needs to be configured properly. MS AJAX is an integral part of ASP.NET 3.5, but requires a separate download for ASP.NET 2.0.
Please note that the last answer provided in this forum thread is from 2/22/2008, that is, one year and three months ago. There is plenty of information and documentation on the Telerik site how to install and configure the suite. In addition to this the Q2 2009 installation adds a Telerik menu to Visual Studio, from which you can invoke a template that will create a blank "Telerik RadControls" project automatically.
In case you encounter a problem with getting your trial RadControls version to run, please let us know and we will do our best to help you.
the Telerik team