We have recently moved to VS2008 and SQL 2008 from VS2005 and SQL 2005.

I have a problem when we deploy our click once application, the following message is displayed

Unable to install or run the application. The application requires that assembly Microsoft.SqlServer.Dmf Version 10.0.0.0 be installed in the Global Assembly Cache (GAC) first.

The assembly is included in the deployment files, but as far as I am aware Click Once cannot deploy directly to the GAC. The issue seems to stem from the Microsoft.SqlServer.Smo assembly which is referenced in the Strataframe DBEngine and UI assemblies. Our application does not reference any SQLServer assemblies directly.

Do you have any ideas on how we can deploy these assemblies through click once?

If you are actually using the dbengine from SF, then you'll need to use the prerequisites feature of ClickOnce to get the SQL DLL loaded into the GAC. However, likely you aren't actually using this in your app and you just need to uncheck this as a required file in the ClickOnce (publish) area.