Does this mean if I have a web project that depends on a class library
and that class library has a reference to an older version of the
assembly which has a a bindingRedirect, that the code will execute as
if it were compiled against the newer version?
You have it right (I would just say “…the code will execute as
if it were referencing the newer version”), see http://msdn.microsoft.com/en-us/library/7wd6ex19%28v=vs.110%29.aspx
“When you build a .NET Framework application against a specific
version of a strong-named assembly, the application uses that version
of the assembly at run time. However, sometimes you might want the
application to run against a newer version of an assembly.”