>So I would imagine that the Server is creating HTML code from the .NET application that "any" browser will render accordingly.

We're talking an ASP.NET Web app, right? If so, yeah. To familiarize yourself with ASP.NET Web Forms and how they play with browsers read the ASP.NET article in this months UT Magazine. It assumes you're following along with VS.NET, but you can just read it straight to get an idea on what a Web Form is.