I hadn't realised this:
Sauce Reader 2.0 is a complete rewrite and no longer requires the .NET framework. Using .NET for Sauce Reader v1 we were never able to achieve the level of performance we considered appropriate for a heavily used productivity application. .NET is a compelling and powerful platform, but currently unsuitable for widely adopted client side applications. [via Synop > Weblogs > Sauce Reader Weblog - Sauce Reader v2.0 (BETA)]
What is strange is presumably they had tried out .NET 2 which would seem to have a more compelling story than .NET 1, but found that lacking as well.