You have probably seen post in our team blog on how to repair VS 2008 after upgrading from Office 2007 to Office 2010. It provides good explanation on what exactly happens. The issue is specific to upgrading 32-bit Office on 64-bit OS. Note that VS 2008 is 32-bit application and so is Office 2007. Office 2010 comes in 32-bit and 64-bit versions. VS 2010 is still 32-bit only. The bug is in incorrect handling of regisration of shared 32-bit vs 64-bit type libraries. You may have a few logical questions though :-).
First, why this issue was not discovered back in Office 2007 / VS 2008 days? Actually, we did see a few reports on VS 2008 design view hanging, but there were less than maybe ten of them total as very few people used 64-bit OS back then, repro steps were inconsistent and in most cases users were able to figure out solution or the problem simply went away after Office 2007 repair or reinstall. So there was not enough information to act upon.
Second, you may ask why this issue was not discovered and fixed before Office 2010 shipped. Actually, it was discovered before Office 2010 shipped, but the bug was in Office 2007 setup and not in Office 2010. Office 2010 simply runs regular silent uninstall on Office 2007 and that’s where the bug is. There was no reasonable solution for the Office 2010 setup. Office 2010 no longer ships MSXML5 and is unable to repair it. So the fix has to be published as Office 2007 update – it is in works, but it takes time to have update published (I will probably write a separate post on publishing updates).
Third, you may be wondering if VS 2010 is affected by any of the Office issues. The answer is no. In VS 2010 time frame we moved HTML designer code base and setup into Visual Studio and the binary is no longer built in Office, it has no Office dependencies and is no longer installed using Office setup. The component is now integral part of Visual Studio and no longer appears as a separate application in Control Panel. You can find designer binaries in Program Files (x86)\Microsoft Visual Studio 10.0\Common7\Packages and in Program Files (x86)\Microsoft Visual Studio 10.0\Common7\Packages\vwd..