I've found that mssqlexpress http://www.xpressapps.com/Home.shtm provides our team with the integration into vss . As mentioned keeping users out of EM is not easy but good integration into VS helps...

I tried this for awhile and was not able to get it either.. Had to resort to persisting without schema and in an element nature rather than attributes

Currently use this product and it works rather nicely...

http://www.xpressapps.com/manual/vers_contr_grp.htm