(Update: I've been able to solve the issue via a dirty hack...)
Unfortunately the current version of the ADO.NET Entity Framework cannot be installed with the RTM version of Visual Studio 2008 released to MSDN subscribers by Microsoft yesterday. The installer gives you an "ADO.NET Entity Framework can only be installed if Microsoft .NET Framework 3.5 Beta2 is installed." error message. Obviously VS 2008 RTM ships with the RTM version of the .NET 3.5 Framework.
I've sent a quick message to ScottGu - maybe he's already got an answer for us.