This just in from Tim Green @ EC Software, GmbH:
Just saw your posts and the announcements about the new Sandcastle developments, that's great to hear! We also have some big Sandcastle news: As of version 5.4 Help & Manual now supports Sandcastle. You can import a Sandcastle project to Help & Manual directly. When you do this, HM runs Sandcastle and redirects its output, converting it to a Help & Manual XML project on the fly. You can then edit (also multi-user) and publish in Help & Manual, with support for Help & Manual's output formats, including CHM and PDF. There's also a mechanism for handling updated Sandcastle projects when you import a Sandcastle update to a project created with an earlier version of the Sandcastle project.
Just a note of clarification that Help & Manual 5.4 currently supports the Visual Studio 2002-2008 Help 2.x format (.HxS), but Visual Studio 2010 Help Viewer 1.0 format (MSHC) is still pending.