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Is there a way to load 1.0 encounter files in 1.1? I tried and it said my encounter was created for D&D 3.0 and the current data set was for 3.5. What are my options?

Right now there aren't any. I want to upgrade encounter & group files to use MT tokens as part of 1.1, but I still haven't worked out the kinks with Trevor. After that is complete I will write a converter that will do the upgrade from 1.0 to 1.1.
If there is enough interest from the group I would be happy to write a simple little converter. It should be fairly easy for groups anyway. Just realize that you will have to upgrade them again at a later date to the final version of the file....

I guess there wasn't any more interest

I am having the same issue. Can't load groups made in 1.0 into 1.1. If I try to load a group (Click Actions-->Add Group) I get the following error:

<filename> does not contain valid group data.

If I try to click File-->Open Encounter I get an error that says that I have the wrong game settings and my encounter can not be loaded.