Same, but I just gave up after 2 days. I really wish there was a one-click option in VS.net to create an installer that checks/pulls the required version of runtime, installs the target exe, all its DLL dependencies, and all custom files marked for release.
It's what 99.9% of apps need, so why is there no "do the defaults" path? You even need to pass things through the Heat generator to get multiple resulting files listed automatically. This is not an exclusive Wix issue though - no project offers that as far as I can tell and it really sucks.