- For development, you definitely need to configure a full set of links . Using a compiled deployment package (which can be downloaded from Codeplex or through WebMatrix) will lead to many problems.
- Orchard can work in both "normal" SQL Server and SQL Server Compact (single-file) databases.
What do you mean by "local copy of the database"? Each developer can test their instance using the local SQL Server CE database - as usual, I do this when working with custom modules.
If you have a pre-configured database that your developers would like to use (because, for example, it contains some examples of data, setting topics, etc.), each developer can copy the database from the server to his own, local SQL Server CE database. Migration can be easily done from Visual Studio, SSMS or WebMatrix.
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