Today I had to set up replication of a database from 2005 to 2008 R2. So started with taking a backup and restoring it on the subscriber instance, this way I don't need to worry of other objects such as Stored Procs to be replicated.
But when I proceeded to add the subscriber, I wasn't able to connect to the 2008 instance from 2005 SSMS because it was at a higher level. So as a workaround, I logged into the server where the 2008 instance was installed. Then via the 2008 R2 SSMS I connected to the 2005 instance. From here I was able to connect to the 2008 instance and add it as a subscriber.
So the only problem while setting up replication from 2005 to 2008 is that you can not use the SSMS for 2005 to connect to the subscriber instance to add the subscriber.