AssemblyVersion

Where other assemblies that reference your assembly will look. If this number changes, other assemblies have to update their references to your assembly! Only update this version, if it breaks backward compatibility. The AssemblyVersion is required.

I use the format: major.minor. This would result in:

[assembly: AssemblyVersion("1.0")]

If you're following SemVer strictly then this means you only update when the major changes, so 1.0, 2.0, 3.0, etc.

AssemblyFileVersion

Used for deployment. You can increase this number for every deployment. It is used by setup programs. Use it to mark assemblies that have the same AssemblyVersion, but are generated from different builds.

In Windows, it can be viewed in the file properties.

The AssemblyFileVersion is optional. If not given, the AssemblyVersion is used.

I use the format: major.minor.patch.build, where I follow SemVer for the first three parts and use the buildnumber of the buildserver for the last part (0 for local build). This would result in:

[assembly: AssemblyFileVersion("1.3.2.254")]

Be aware that System.Version names these parts as major.minor.build.revision!

AssemblyInformationalVersion

The Product version of the assembly. This is the version you would use when talking to customers or for display on your website. This version can be a string, like '1.0 Release Candidate'.

The AssemblyInformationalVersion is optional. If not given, the AssemblyFileVersion is used.

I use the format: major.minor[.patch] [revision as string]. This would result in:

[assembly: AssemblyInformationalVersion("1.0 RC1")]

C# language version history:

These are the versions of C# known about at the time of this writing:

• C# 1.0 released with .NET 1.0 and VS2002 (January 2002)
• C# 1.2 (bizarrely enough); released with .NET 1.1 and VS2003 (April 2003). First version to call Dispose on IEnumerators which implemented IDisposable. A few other small features.
• C# 2.0 released with .NET 2.0 and VS2005 (November 2005). Major new features: generics, anonymous methods, nullable types, and iterator blocks
• C# 3.0 released with .NET 3.5 and VS2008 (November 2007). Major new features: lambda expressions, extension methods, expression trees, anonymous types, implicit typing (var), and query expressions
• C# 4.0 released with .NET 4 and VS2010 (April 2010). Major new features: late binding (dynamic), delegate and interface generic variance, more COM support, named arguments, tuple data type and optional parameters
• C# 5.0 released with .NET 4.5 and VS2012 (August 2012). Major features: async programming, and caller info attributes. Breaking change: loop variable closure.
• C# 6.0 released with .NET 4.6 and VS2015 (July 2015). Implemented by Roslyn. Features: initializers for automatically implemented properties, using directives to import static members, exception filters, element initializers, await in catch and finally, extension Add methods in collection initializers.
• C# 7.0 released with .NET 4.7 and VS2017 (March 2017). Major new features: tuples, ref locals and ref return, pattern matching (including pattern-based switch statements), inline out parameter declarations, local functions, binary literals, digit separators, and arbitrary async returns.
• C# 7.1 released with VS2017 v15.3 (August 2017). New features: async main, tuple member name inference, default expression, and pattern matching with generics.
• C# 7.2 released with VS2017 v15.5 (November 2017). New features: private protected access modifier, Span<T>, aka interior pointer, aka stackonly struct, and everything else.
• C# 7.3 released with VS2017 v15.7 (May 2018). New features: enum, delegate and unmanaged generic type constraints. ref reassignment. Unsafe improvements: stackalloc initialization, unpinned indexed fixed buffers, custom fixed statements. Improved overloading resolution. Expression variables in initializers and queries. == and != defined for tuples. Auto-properties' backing fields can now be targeted by attributes.
• C# 8.0 released with .NET Core 3.0 and VS2019 v16.3 (September 2019). Major new features: nullable reference-types, asynchronous streams, indices and ranges, readonly members, using declarations, default interface methods, static local functions, and enhancement of interpolated verbatim strings.
• C# 9.0 released with .NET 5.0 and VS2019 v16.8 (November 2020). Major new features: init-only properties, records, with-expressions, data classes, positional records, top-level programs, improved pattern matching (simple type patterns, relational patterns, logical patterns), improved target typing (target-type new expressions, target typed ?? and ?), and covariant returns. Minor features: relax ordering of ref and partial modifiers, parameter null checking, lambda discard parameters, native ints, attributes on local functions, function pointers, static lambdas, extension GetEnumerator, module initializers, and extending partial.

In response to the OP's question:

What are the correct version numbers for C#? What came out when? Why can't I find any answers about C# 3.5?

There is no such thing as C# 3.5 - the cause of confusion here is that the C# 3.0 is present in .NET 3.5. The language and framework are versioned independently, however - as is the CLR, which is at version 2.0 for .NET 2.0 through 3.5, .NET 4 introducing CLR 4.0, service packs notwithstanding. The CLR in .NET 4.5 has various improvements, but the versioning is unclear: in some places it may be referred to as CLR 4.5 (this MSDN page used to refer to it that way, for example), but the Environment.Version property still reports 4.0.xxx.

As of May 3, 2017, the C# Language Team created a history of C# versions and features on their GitHub repository: Features Added in C# Language Versions. There is also a page that tracks upcoming and recently implemented language features.