With the release of BlackBerry Enterprise Server 5 Service Pack 3 (5.0.3), RIM have dropped support for the Microsoft SQL Desktop Engine (MSDE).
If you have upgraded a previous version 4.x BlackBerry server to version 5.x and wish to upgrade to 5.0.3, you will receive an error message stating that you do not have a supported database platform and the upgrade will not proceed any further.

The MSDE installation must be upgraded to SQL Server 2005 Express or later in order to install BES 5.0.3
In this article I shall run through how I installed SQL Server Express 2008 in order to upgrade from BES 5.0.2 and MSDE to BES 5.0.3 - note this is not an official RIM solution.

Stop and disable all BlackBerry services

Open the Service Control Manager (Start --> Run --> "services.msc").
Stop all running BlackBerry services.
Edit the properties of all BlackBerry services that have a Startup Type of "Automatic", and set them to "Disabled".

Download and install SQL Server Express 2008

NOTE - you will also need to download and install Windows Installer 4.5 in order to run the SQL installer.
Install a new SQL instance rather than upgrading the existing installation. Select the option to install the management tools (selected by default).

Backup the BESMgmt Database

Open the SQL Management Studio and connect to the MSDE instance (normally the servername).
Take a full backup of the BESMgmt database to a file location.

If you receive an error that the file is in use, stop the running MSDE instance.

Restore the BESMgmt Database

Still within the SQL Management Studio, disconnect from the MSDE instance and connect to the SQL 2008 instance (normally servername\sqlexpress)
Right click on Databases and select the option to Restore Database.
Enter a name for the new database, such as BESMgmt2
Select the option to restore from Device, and add the backup file you created earlier.

Ensure the restore operation completes successfully and then close the SQL Management Studio.

Enable SQL TCP/IP connectivity

Open the SQL Configuration Manager. Browse to SQL Server Network Configuration --> Protocols for SQLExpress.
Right click on TCP/IP and Enable it.

Close the SQL Configuration Manager.
Stop the MSDE instance from running at startup.

Reboot the server.

Re-enable BlackBerry services

Open the Service Control Manager and change the Startup type for all BlackBerry services we disabled earlier back to Automatic. Do not start the services at this time.

Install BES 5.0.3

Start the MSDE SQL instance.
Now launch the BES 5.0.3 installer.
Set the database server to the SQL 2008 instance (servername\sqlexpress)
Set the name of the configuration database to the database you created earlier from the backup.
Set the Port configuration to "Dynamic"

The installation will now proceed.