Volta
I have wondered for around 6 or so months now when the first CTP of Volta would be released and it seems that today is that day!
http://labs.live.com/volta
I have not yet looked at the bits but other than providing a nicer way to build web apps, Volta also has a compiler that compiles down to JS or MSIL. You can probably target one or the other explicitly, but the beauty of Volta is that if the runtime detects a CLR on the users machine then it will gen MSIL and get all the performance benefits, etc etc, otherwise it will compile (or maybe translate) to JavaScript (cross browser of course).
Like I said I've not tried it, but its a very interesting approach - I believe that this CTP only works with VS 2008 RTM not past betas...I think.