Today Microsoft kindly extended my deadline by 24 hours so that I could further consult my lawyers. So far they have done a very good job of keeping the pressure on. This isn't simply a case of knocking out a quick email Pirate Bay style!
Before I released support for Visual Studio Express, I made a point of carefully reading the Express EULA. After reading it I was confident that the technique I was using wasn't in breach of the license. I am now acutely aware that if I turn out to be wrong I could end up losing everything. This isn't a situation that any developer wants to find themselves in.
Unfortunately the alternative to fighting this is bowing down to a vague catchall clause. I am an anxious person and don't want live in fear of this kind of thing.