I'm on a team that's currently building a MOSS 2007 based application (which relies on .NET 2), and we'd like to leverage the Entity Framework v4 (which relies on .NET 4).
Is this possible?
No. The 4.0 version of .NET has a new CLR (4.0) etc., but SharePoint 2007 is only supported on CLR 2.0.
Even SP2010 does not support .net 4.0 (yet).