Normally, there is no backward compatibility, as too much has changed in the program vs the previous. One could always Export the material, and Import that AV file(s) into the previous version to edit. Obviously, it would Import as per what was done on the Sequence.
Now, I did find an interesting little tidbit about backward compatibility, but it was for Encore. I've been able to open En CS3 Projects in En 2.0, and they seem to come in with few problems. This is, however, NOT PrPro CS3 to PrPro 2.0.
Export your project as an AAF file (Project > Export Project as AAF). CS3 should be able to open this file, and recreate it... mostly. Some effects won't travel backward, so you'll need to redo those.
Thanks for the info. The problem I get is that the AAF file doesn't cross over the organized bins, and the sequences are empty.... it doesn't work as well as the XML export in FCP. Or am I doing it wrong?