>For development purposes I have MS SQL 2000 Developers Edition installed on my laptop. Can I use this to develop applications that will use MSDE when in production?

Yes, you can.

> If so how do I move a database from SQL 2000 to MSDE?

There're different ways to do that. You can detach DB, make a copy and attach it to MSDE. If you can connect to both of them, you can use Copy DB wizard in Enterprise Manager.