Recently i downloaded SQLServer Compact 3.5 from Microsoft web site, and i have already installed Visual Studio 2008. When i make a new Smart Device project and try to connect some Dataset to local database, the following error rises : "Error 1 Custom tool error: This operation requires a reference to SQL Server Compact 3.5. The project has a reference to a different version. Update the reference and try again."
i tried reinstalling Visual Studio 2008, but it did not work.
I had same problem, This problem is happen with SQL Compact service pack2, but you can use SP1 and use code to manipulate your database. It had been solved.