As it turns out, we have a bug in finding metadata assemblies that will be in Visual Studio 2008 RTM. I described how we find and load metadata assemblies in a previous post and the bug pertains to the situation where:
The main line scenarios where this will be true is:
Workaround
In order to handle all of the situations (note that your customers may GAC your assemblies on you provided your assemblies are strong named) you need to provide 2 sets of design time assemblies (in your AssemblyFolder):
Sorry for the inconvenience, at least there is a reasonable workaround.
PingBack from http://blogs.msdn.com/jnak/archive/2007/08/14/how-are-metadata-assemblies-found.aspx