Switched to 2.5 today, and chose .net 3.5 and getting EntityFactoryCore2 not found.

There is nothing missing from the project, (ie. all files are included)

Try it with a new project instead, maybe some of the files are not being properly overwritten. This may help you as well (http://llblgen.com/TinyForum/Messages.aspx?ThreadID=12262&StartAtMessage=0)