As long as I have been a developer (more years than I care to admit) I still find the task of distributing an application to be daunting at times. Often the process of deciding exactly what files and prerequisites (such as Net 2.0) to include with your application can difficult at best.
That said, here is a link to an MSDN page describing the VBE 'Click Once' procedures:
If you are looking for a clear & simple explanation of anything that Microsoft produces you may have to wait quite a long time...
The /Release version of your application is the directory that you should use for publishing. Among other things, this directory does not include the files *.vshost.* which the IDE uses when you are running your application prior to compiling. When you "publish" the files will automatically be gathered from the /Release directory.
I was tempted to outline the procedures that I use to publish an application to my corporate network, but I am not sure that the steps are exactly the same between VBE and the VS version.