Question

1.

Assuming that you don’t have Visual Studio installed and you want to use command line for development, do you need the .NET framework SDK?

The reason for my confusion is that the description for the redistributable says “The Microsoft .NET Framework 4 redistributable package installs the .NET Framework runtime and associated files that are required to run and develop applications to target the .NET Framework 4.”

In this case, why is the SDK needed?

2.

If I understand correctly, the rational behind the introduction of the client profile flavor of the redist was to have a smaller installation. Yet, it seems to be merely 15% smaller (41 MB vs 48 MB, see links below). Is it really worth it?

Links:
Client profile redist
Full redist
SDK

Answer 1

Runtime is the component that must be installed on machines that intend to run .NET applications.

The redistributable package installs the .NET Framework runtime and associated files that are required to run and develop applications.

The SDK is a software development kit and provides tools, compilers, headers, libraries, code samples, help system etc. that developers can use to create applications that run on Microsoft Windows.

To develop you will need SDK.

EDIT:
To answer second question:
Well size difference is not the only consideration.
Client Profile is the framework that will be available on Windows Update for desktops

I will quote Scot Hanselman:

The general idea is that they
(Microsoft) avoid installing things you don’t need a client machine. That
means they won’t install ASP.NET on
your Mom’s computer just because she
wants a game. Also, the .NET 4 Client
profile is a proper subset of the .NET
4 “Full” Framework.

More on his blog.