Well, I went ahead and installed the Oct 2004 CTP's of SQL Server 2005 and VS.NET 2005. SQL went great. VS.NET - not so great. Two main problems (one fixed, one in Product Feedback pending review from Redmond):
1) The ASPNET_ADMIN.EXE Registry entries were not updated by the install, so the service failed on boot. Reason? Simple - they were still pointing to an exe located in the 2.0.40901 folder, and the new correct version folder is 2.0.40903.
So, manually changed the registry entries and everything is fine.
2) Installation of the Virtual PC (VPC) Network driver failed on first install. Second time around, it appeared to take, but when you go to debug a Compact Framework app in the emulator, you get a nasty popup to the effect that its not installed. Tried every fix out there including Amit Chopra's blog stuff (From MS - see link above) and no dice. Boo - Hoo!
I did have EVC++ installed and Chopra indicated that could be a possible cause, but its not installed now. I even tried installing Virtual Server 2005 trial to update the driver, and it did, but it didn't help.