How to make the WiX Bundle version the same as my application’s version

To answer your first question, there are no hard and fast rules for this. So it is not a must to update your WIX bundle version and match that with your MSI version.

As for the second question, am not really sure. But you can try this binder variable:

!(bind.packageVersion.PackageID) 

EDIT replace PackageID with the element “ID” attribute of the program that you are installing. Something like: Version="!(bind.packageVersion.MyAppName)"

<MsiPackage SourceFile="SomePath\MyAppName.msi" Id="MyAppName"/>

as mentioned in this POST. Also check the WIX documentation for more binder variables.

EDIT 5/11/2017 – looks like there was confusion around what the packageID should be and I have edited the answer based on Bob Lutz answer below.