You're building a project named A.exe and you've included a file reference to the assembly B.dll (the value of the "CopyLocal" option is set to "true"). Assembly B references C.dll and D.dll, one of which is installed to the GAC. When you hit the build button, a copy of B is made in the project's output directory. Now comes the tricky part: without the ability to specify (or query) the "CopyLocal" option for the dependent assemblies, does msbuild.exe copy C.dll and D.dll? The answer: if the dependent assembly cannot be found in the GAC, then it's copied; otherwise it won't.
One more trick here: don't use Windows Explorer to try and view the GAC on another machine; you can't. Something about a shell extension? You can see the GAC with a command prompt and a mapped network drive.
To disable the shell extension, you can set the following registry value:
HKLM\Software\Microsoft\Fusion\DisableCacheViewer [DWORD] to 1. This will enable you to view the GAC of a remote machine.