JC asks what this new funky myAppName.vshost.exe is created at the same time as myAppName.exe… Well, this is used for debugger support. If you look at the content of that file, what you will see is mostly a dumb assembly containing only the following:
public static void Main(string argv)
HostProc proc1 = VsHostAppDomainManager.HostProcListener;
What this does is simply use the new hosting model by using the VsHostAppDomainManager class in vshostutil.dll, which you can find in c:\program files\Microsoft Visual Studio 8\Common7\IDE. It inherit from the new System.AppDomainManager in mscorlib.dll. It obviously controls the security settings (letting you run your debug code in any trust level you want) and other nifty things, including redirecting the console input and output to the nice little Console window in visual studio.
A confirmation here. Once again brought to you first by the technologist :-)