I work on a small web team where I am the only .NET developer currently using Visual Studio 2008 Professional to build and maintain a few web applications. I am about to start training another member of our team so we purchased him a copy of Visual Studio 2008 Professional. I've looked into Visual Source Safe, but I'm dubious. I don't like that is file system based. Ideally, the system would work with SQL Server 2005 and plug into Visual Studio. Windows based solutions are the best because of the IT environment of the organization I work for.
What are my options for a source control system?
(Forgive me if the answer exists in another thread.)
Has any body given Git any thought? There is a very usable solution for windows called GitExtensions here. It integrates with Visual Studio Professional trough an extra menu and optional toolbar. Unlike Subversion, Git is distributed, which means you can commit locally to your copy of the repository, and afterwards push the changes to the server. The bottom line? Git is FAST! It's storage is also more efficient than subversion, which means your repository takes up less space.
Visual SVN might work for you, it is supposed to integrate well and is relatively cheap at ~$50 per license. I've been considering buying it myself, so far I just use Tortoise SVN as I do relatively little non-Eclipse work right now.
Subversion has good integration with Visual Studio 2008 through VisualSVN and Ankh.
SourceSafe is dangerous. You're right that a filesharing-based SCM is a bad idea, and Microsoft themselves have downplayed it and replaced it with a new SCM that comes with the Team edition of Visual Studio.
Microsoft's Team Foundation Server integrates fully into VS2008 and uses SQL Server for its back end. The downside is that it's a very expensive solution.
Subversion. Free. Visual SVN is a great add on, and is fairly inexpensive.
Team Foundation Server does satisfy your requirements of working with SQL Server, but is probably overkill for such a small development team.
I would recommend using Subversion (free) for source control along with VisualSVN ($49) for the visual studio integration. There is also an excellent Subversion client for windows explorer called TortoiseSVN, which is awesome.
The nice thing about giving something like Subversion a try is that it is free and very easy to set up. It will also scale up to a pretty large team. It is worth a shot before investing effort in MSFTs Team Foundation Server.