Recently I had an issue when trying to open a project built with the cloud application studio.
I always got the hint that I had to retarget the project to the .NET Framework 4.
After reinstalling the cloud application studio it was also not working. I tried several things, without success. The only thing that was finally working was to download Visual Studio Shell 2010 from here:
Perhaps this helps you not to search several days for a fix 🙂