@gduncan411: Thank you for such a thorough reply! We don't use SharePoint at work now, so we wouldn't loose anything there. However, the thing the guys really talked about at last night's .NET meeting, was the reporting features of TFS 2012. If TFS Express 2012 doesn't have reporting, then it does seem as though I'd be missing a very important feature. That's unfortunate. So then, what I get "out of the box" with TFS Express, is version control and agile planning features, correct? I already have SQL Server 2008 Express (or perhaps it's SQL Server 2008 R2 Express) on my desktop, but I don't believe it's the default instance, as I also have SQL Server 2008 Developer Edition, which is the default instance. Does TFS Express require that it's database be in the default instance?
Personally, I am really favoring installing a local instance. Sorry, I'm just more comfortable with a local instance. However, with TFS in the Cloud, how is one's source code treated? For example, I believe with Git (which I have no experience with) one's source code is open to everyone to see and modify, unless you pay for private storage on Git. Is that the way it is with TFS in the Cloud?