So here's a question I get from time to time:
"Hey JC, I see that SoftGrid will automatically install MSDE for me so obviously it's OK if I use that to support all of my production users, right?"
Actually the answer here is 'No'. Now technically it might work if you have only a handful of users but officially this is not something that Microsoft supports. What does that mean exactly? That means that if you choose to use MSDE in a production environment, Microsoft product support reserves the right to ask you to recreate the issue on Microsoft SQL Server as a troubleshooting step. Can you use it in a test environment? You bet. Can you use it as part of a proof of concept (POC)? Absolutely. Can you use it if you don't have many users? Maybe, but not if you want to be running a supported config.
Why, you ask? There are many reasons why, including MSDE's limited support for CPU's, limited support for RAM, a limit on db size, the lack of a SQL Agent job scheduling service as well as no support for enterprise management tools, among other things. But why really isn't important. What's important is that if you want to prevent a lot of pain and heartache in the future and you want to run in a supported manner, find a SQL Server box somewhere and use that. You'll be glad you did. Oh, and I almost forgot - this goes for SQL Express too.
- J.C. Hornbeck