TFS on visualstudio.com

We have this documentation showing you how to make the connection:
http://www.telerik.com/automated-testing-tools/support/documentation/user-guide/source-control/team-foundation-service.aspx

I am glad you got it worked out.

Are you familiar with what a "workspace" is in Visual Studio/TFS? It's trying to tell you there's a conflict between the workspace that Test Studio uses (it will end in "WebUITestStudio"), and your other workspace "DELI-DEVASTATOR".  You'll need to use Visual Studio to resolve the conflict. This means removing the already existing mapping from one or the other workspace.

I am sorry for the confusion on this. While the standalone Test Studio IDE is (mostly) autonomous, as soon as you want to integrate it with TFS source control, you add a dependency on TFS components and the way TFS source control works. For starters Test Studio does not come with the TFS DLL's required to connect to a TFS source control repository (I think you already know this) because Microsoft doesn't allow redistribution of their DLL's. You must at least install the Microsoft Team Explorer (which comes with Visual Studio). Second the source control and the workspaces are TFS controlled, not Test Studio controlled. Test Studio is a user and consumer of them, not the controller of them.

Also, Test Studio is not, and never will be, a full fledged workspace manager or source control manager. The product is not intended to be such. It is only a TFS source control client intended to use TFS source control but nothing beyond that.

When there is a problem with the workspace (such as you are experiencing) or the source code repository you must use a Microsoft tool to make the required adjustment. Test Studio does not include the ability to make these types of adjustments to your TFS controlled source code repository or TFS controlled workspace.

I hope this explanation clears up any misunderstanding how the two work together.

Okay, so you're saying I should be opening visual studio and adding my test studio project into there instead of test studio itself checking in\out tests?

No I'm sorry I'm not trying to state that. You can if you'd like to (use our Export to Visual Studio to create a VS project file), but this is certainly not required. I like doing this so i can switch back and forth between the two for the same test project. I find that I prefer writing my coded steps in Visual Studio. But I'm doing this to take advantage of the advanced code editing you get with Visual Studio, not to solve any workspace problems.

What I'm trying to get at is that Visual Studio comes with an advanced source control explorer and workspace manager. You can use this just by launching Visual Studio. You don't even need to have a project open in Visual Studio. Once you get into the Visual Studio source control explorer you will be able to fix the workspace conflict you're running into.

Does that help clarify?