>>I think I saw your problem recently discussed in that forum http://forums.asp.net/t/1349387.aspx
>>
>>I'll search a bit later.
>
>The SQL Server 2005 Express tools is not listed as is as part of the installed programs. We have to do as if we want to uninstall SQL Server and then only select Workstation components.

Right. Someone else was having problems uninstalling SQL Server Express prior edition, but I searched and could not find this thread so far.

I've installed SQL Server Express 2008 on a fresh PC without problems. However, there is an interesting problem discussed here
http://forums.asp.net/t/1340139.aspx

and as a minor problem I noticed that Ctrl+Shift+M dialog doesn't work for entering procedure parameters.

In the meantime I'll continue my search.