Having spent a whole heap of time looking at the same issues

- the first question you really need to ask yourself is.

Do I REALLY need to create compiled modules right now ???
And then - Do I REALLY need to create compiled modules at all.

Frankly - the compiled modules approach can be a huge nightmare waiting to happen.

You are likely to face referencing issues, versioning issues, wierd file compatibility issues with controls that seem to loose track of their code behind code.

Not to mention the compile / debug dance.

Basically, the native approach of asp.net 2.0 is to work using a compile on demand system.
And for the most part this is also the native approach for dnn 4.4.1. (aside from dotnetnuke.library and friends)

SO INSTEAD LETS LETS LOOK AT THE OTHER OPTION.

WE DONT CREATE A MODULE SOLUTION
AND WE DONT WORK WITH THE DNN SOLUTION

INSTEAD

1. when you start VS2005 - you browse to your development website and open it directly - NOT THE SOLUTION - but the SITE ITSELF.

2. open the site properties inside VS2005 and set the compile site option to DONT COMPILE.

3. Setup your debug options to target your website

you are now ready to develop

4. Use the DNN Dynamic Module template to make a new module.

it creates starter code in:

\App_Code\YourModule
\DesktopModules\YourModule

You can now create your module components in the DesptopModules area
And any library components - read .vb files in the \App_Code\ area.

Now here is the interesting part ...

To debug your code - you hit debug - and the site starts (Assuming you set the debug settings)

YOU dont need to compile your code - OR the dnn portal for this to work.

And you can even continue to edit code while you are in debug ... with the webserver - recompiling the code on the fly with each page request.

>>>>>>>>>>

You also gain full access to the ENTIRE dnn site space - which means you can seamlessly include DNN components on your own pages without referencing nightmares -

For example - want a custom signin module - just cut and paste the whole DNN signin.aspx/signin.aspx.vb code into a new module and hack away - (dont even get me started on the nightmare referencing issues you get trying to do this in a standalone)

>>>>>>>>>

Oh and if you do need to eventually export out a COMPILED.dll  and not distribute your source code - you still can - simply by publishing the web site - and packaging up to resulting compiled module files.