Ok. For anybody that needs the solution, I totally figured it out. If you want Visual Studio 2008 (or 2005) to show your styles for sure, you need to create the container/skin/extension in DNN 5.1.x first. Here are some steps.
1. With the DNN solution opened in VS, right click default.aspx in the root folder and click view in browser.
2. When the home page comes up, click login and sign in with your host username/password.
3. Go to host>extensions and click create new extension.
4. Fill out the details (container in this case) and proceed through the wizard until you are returned to the main host>extensions table.
5. In VS, go to \portals\_default\containers and create a folder with the same name as your new container. Since I put EternityRecords as the container name, my folder would be called EternityRecords. Make sure it's in _default (the host provided containers) or DNN wont find it in reference to this install.
6. Create the containers to your hearts content.
6. for the containers global styles, use container.css [all lowercase]. This will be used for all controls in portals\_default\containers\ContainerName.
7. For the individual controls styles, use [containerName].css making sure the spelling is exact. If I have a container control called Simple.ascx, its styles file would be called Simple.css. Make sure this is in the same foler as container.css above.
8. To combine css classes on a single control, leave a space between each class name in the class or CSSClass property of the control. An example is <DNN:Title id="Title1" runat="server" CSSClass="Title TitleColor"/>
9. To create the container package, Start DNN, Go to host>extensions and click edit this extension in the table next to your new container. You can make it easier to find by clicking container in the filter drop down at the top of the table.
10. Click create package at the bottom of the edit extension wizard.
11. Fill out the wizard as needed. To create the package, check the create package box in the wizard. If all you want to do is regenerate the .dnn file for it, uncheck the create package button.
12. The package (if created) will be in \install\containers.
HTH...