That is true - you cannot deploy any SSRS 2005 report that contains a custom report item to a SSRS 2008 server, which is a confirmed limitation of the automatic SSRS 2008 auto upgrade. When you run a SSRS 2005 report on a SSRS 2008 server, the server performs an automatic conversion of the old RDL schema to the new one. In this process it converts what it can from the old RDL format to the new one, and actually renders the converted copy.
As far as we know, we are the only vendor for SSRS that provides forward and backward compatible state of the the report items (e.g. you can use SSRS 2008 to develop a chart and then load its template in a SSRS 2005 report and vise versa). Unfortunately we cannot plugin in the default SSRS 2008 auto upgrade to perform that automatically.
Best Regards,
Nevron Support Team