As noted in our System requirements, Visual Studio Express editions (VWD) are not supported due to limitations of the IDE. They do not offer the full feature set of the standard Visual Studio, and do not allow 3rd party extensions, such as the ones used by Telerik Reporting. For more information please see this forum thread. This limitation prevents Telerik's Report Designer from operating correctly as it requires a number of the restricted features.
However if you don't need the design time support, you can still use the Reporting API to create your reports programatically (basically the designer saves you some manual coding). For more information on the matter please see Programmatic Control of Reports help article.