I work in a group of 4 .Net developers. We rarely work on the same project at the same time but it does happen from time to time.We use TFS for source control. My most recent example is a project I just placed into production last night that included 2 WCF services and a web application front end. I worked out of a branch called "prod" because the application is brand new and has never seen the light of day. Now that the project is live, I need to branch off the prod branch for features, bugs, etc...

So what is the best way to do this?

Do I simple create a new branch and sort of archive the old branch and never use it again?

Do I branch off and then merge my branch changes back into the prod branch when I want to deploy to production?

And what about the file and assembly version. They are currently at 1.0.0.0. When do they change and why? If I fix a small bug, which number changes if any? If I add a feature, which number changes if any?

What I am looking for is what you have found to be the best way to efficiently manage source control. Most places I have worked always seem to bang heads with the source control system in on way or another and I would just like to find out what you have found that works the best.