[Update 2010-08-25: Wade Wegner now shows a solution on his blog]

We’ve been getting some questions along the lines of “I am hosting a service as xyz.svc in IIS and have changed the config to use on of the Service Bus bindings, but the service never gets called?”

That’s right. It doesn’t. The reason for that is that we don’t yet have WAS/IIS integration for any of the Service Bus bindings in the November 2008 CTP. Enabling the WCF WAS activation scenario that puts the NetTcpRelayBinding and friends on par with their WCF siblings is on our work backlog for the next major milestone.

It’s worth considering for a moment what that integration requires. Fundamentally, all of the Relay bindings replace the local TCP or HTTP listener with a listener that sits up in the cloud and services then connect up to that listener to create an inbound route for received messages. That’s similar to how local services interact with WCF’s shared TCP listener or HTTP.SYS, but there are quite a few important differences. First, all Relay listeners need to acquire and present an Access Control token when they start listening on the Service Bus. In contrast, the local listener facilities are ACL’d using the local or domain account system and use the Windows process identity to decide on whether a process may or may not listen on a particular port and/or namespace. Second, since the actual listener is off-machine, we need to spin up the connection as the IIS/WAS host spins up and need to make sure that the connection is kept alive and aggressively reconnects when dropped for any reason. That’s something you don’t really have to worry much about when the listener sits right there on the same machine as your own service and the connection is a named pipe. Third, the local listeners listen on a particular host address and port; the Relay listeners listen on a leaf of a namespace tree and that namespace may be shared amongst many listeners living on a multitude of different machines in different locations.  Fourth,   ... well you get the picture.

Bottom line: Not having support for WAS activation and xyz.svc service endpoints is by no means an oversight. It’s on the list.