Update the the Visual C++ Directories in the Projects and Solutions section in the Options dialog box.
In that section, you'll want to add the paths to the appropriate subsection:
Executable files - C:\Program Files\Microsoft SDK\Bin
Include files - C:\Program Files\Microsoft SDK\include
Library files - C:\Program Files\Microsoft SDK\lib
Update the corewin_express.vsprops file.
You just need to take one more step to make the Win32 template work in express. You need to edit the corewin_express.vsprops file (found in C:\Program Files\Microsoft Visual Studio 8\VC\VCProjectDefaults) and change the string that reads:
AdditionalDependencies="kernel32.lib user32.lib gdi32.lib winspool.lib comdlg32.lib advapi32.lib shell32.lib ole32.lib oleaut32.lib uuid.lib"
In Beta 2, the Win32 Windows Application type is disabled in the Win32 Application Wizard. To enable that type, you need to edit the file AppSettings.htm file located in the folder “%ProgramFiles%\Microsoft Visual Studio 8\VC\VCWizards\AppWiz\Generic\Application\html\1033\".
In a text editor comment out lines 441 - 444 by putting a // in front of them as shown here:
// WIN_APP.disabled = true;
// WIN_APP_LABEL.disabled = true;
// DLL_APP.disabled = true;
// DLL_APP_LABEL.disabled = true;
Save and close the file and open Visual C++ Express.
From the File menu, click New Project. In the New Project dialog box, expand the Visual C++ node in the Product Types tree and then click Win32. Click on the Win32 Console Application template and then give your project a name and click OK. In the Win32 Application Wizard dialog box, make sure that Windows application is selected as the Application type and the ATL is not selected. Click the Finish button to generate the project.