It appears that the old issue in VS2010 where the .ascx.g.cs file does not generate after a certain number of characters in the .ascx file is reached, is back in VS2012.
Create a visual web part project (appears to be an issue in both sandboxed and farm projects). Start adding controls to the user control.
After a certain point, the designer stops generating the .ascx.g.cs file and the project will not build as the code cannot see the InitialiseControl method or any of the controls definewd in the user control.
So now it is NOT POSSIBLE at all to implement a Visual Web part for SP2010 in Visual Studio 2012.