So after many hours looking into this issue, it seems that the current release of PPS does not work on SQL Server 2008, and there seems to be no tricking it. Should you manage to get round the install checks, while setting up the Database Connections...
As I am sure you can all Guess SQL 2008 is the next release of SQL Server, and does not redesign the wheel, and is more an enhancement to 2005. Microsoft claim that they have made it more secure, more reliable, more scalable etc... etc... Business Intelligence...
It always astounds me what Microsoft are willing to bundle with their software, Analysis Services or SSIS (SQL Server Integration Services) with SQL Server for example! They haven't stopped, they bundle Windows Sharepoint Services with Windows Server...