Using SQL Server 2008 and SQL Server 2005 and date time
A quick google points me to what looks like the solution.
Open your EDMX in a file editor (or “open with…” in Visual Studio and select XML Editor). At the top you will find the storage model and it has an attribute ProviderManifestToken. This has should have the value 2008. Change that to 2005, recompile and everything works.
NOTE: You'll have to do this every time you update the model from database.
Quick view of line:
<Schema Namespace="Foobar.Store" Alias="Self" Provider="System.Data.SqlClient" ProviderManifestToken="2005" >