There is an excellent PDC talk available here from Vishal Joshi which describes the new MSDEPLOY features in Visual Studio 2010 - as well as how to deploy an application wit
Here's the steps that finally worked for me. I wanted to get the working with RemoteAgent, but couldn't get that working no matter what I tried.
You don't have to do exactly like this, but this is how I got it working
Remember these are all arguments to MSBUILD added within the TFS Build definition
/p:DeployOnBuild=True
/p:DeployTarget=MSDeployPublish
/p:MSDeployPublishMethod=WMSVC
/p:MsDeployServiceUrl=https://staging.example.com:8172/msdeploy.axd
/p:username=sweaveriis
/p:password=abcd1234
/p:DeployIisAppPath=staging.example.com/virtual_directory_name
/p:AllowUntrustedCertificate=True
Note: staging.example.com is actually the local box with a hosts file entry pointing to 127.0.0.1. Localhost would probably work here too.
Useful articles:
Troubleshooting MSDeploy issues
More troubleshooting