This source ( http://blogs.msdn.com/b/lightswitch/archive/2010/11/30/anatomy-of-a-lightswitch-application-part-4-data-access-and-storage-2.aspx) mentions that SQL Server Compact 3.5 is not supported. However in the Microsoft LightSwitch IDE you can indeed get connected to this data without any problem.
What is more, you can even develop a screen to search the data. Where it really fails in when displaying a screen. The Meta Data is retrieved, but not the data.
If you continue, you get a screen related exception.
Probably with a little more tweaking of VSLS (Visual Studio LightSwitch) program this could be even viable.