I've done this many times using the same process, but it appears something is broke or has changed in my Crystal XI environment.
My process has always been to create the schema file in my vb.net code and then use Crystal - Standard Reprot - Create New Connection - Database Files, and then point to my schema file to load the dataset\datatable from my vb.net project.
I'm now getting this error when I choose my schema file??
Here's how I create the schema file in vb.net: