The information in this post is out of date.
Visit msdn.com/data/ef for the latest information on current and past releases of EF.
Nihit Kaul, a Test Lead on the Entity Framework Designer team posted a great blog entry about type sensing for function imports. You can check out the full article (with tons of screenshots) here. Also check out Shyam and Chris’ EF4 PDC presentation for video of this feature in action (its around the 34 minute mark).