I have created WCF Data Service. I used EDM with derived entities (inheritance) to generate the underlying conceptual and actual models. 'Element' entity is a root and 'Follower' is derived entity. Only the root entity, 'Element', is included in the Atom description of the service when calling the service from the browser, as follows
<?xml version="1.0" encoding="UTF-8"?>
<service xmlns:atom="http://www.w3.org/2005/Atom" xmlns="http://www.w3.org/2007/app" xml:base="http://localhost:3816/SentagonDataService.svc/">
But when I use the above oData data service as a data source in the LightSwitch project in Visual Studio 2012 I get the following message in the data source wizard; "The selected service does not expose any entites. Once entities are added, you will need to refresh this data source." As you can see in the above xml 'Elements' is described as a source.