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Integrating native .Net app with external SQL connection

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We are looking into building a C#.Net web application that uses a SQL relational database, but host it inside of SharePoint 2010. Why? Because it is a central location for internal apps. How? Not sure ...

The conditions for this app are as follows:
1. Needs a relational database and not a SharePoint Config database
2. App will be complex - similar to a sales dashboard involving emp stats + customer data
3. Want to integrate events of the web app into SharePoint events (alerts, workflows, etc.)

This app does the following things:
1. dashboard to sales people's performance, sales numbers, etc.
2. drill-down into customer data, purchase history, etc.
3. view of inventory
4. CRUD operations for entering new data

So you can see it is rather complex. Since this data already exists in SQL Server databases we want to expose it in SharePoint through a web application. The question is should it be done in native SharePoint? Should it be done in native .Net app and simply sit inside SharePoint? Is there a way to integrate the .Net app and SharePoint to share info? Should we just keep the two completely separate and host our app on a normal IIS web site?

What are the best ways to accomplish this type of project. I know that SharePoint is not meant to house large amounts of data nor is it to be used as a relational database. We have many different tables in our data structure some of which have millions of rows of data. Since SharePoint limits list data at 100K it is not feasible to pull all this data from our SQL database and place it into a SharePoint database.

So what are the best steps to figuring this out? Do we create a custom web part that makes calls directly to an external SQL server and have the app "live" in SharePoint? Are we asking for trouble? If we move forward with this approach is it possible to capture events and store them in SharePoint which we can use to create alerts, workflows, etc. ? I have recently installed Layer2's BDLC feature in our farm and loaded data into a list. It works pretty nice, but since it still does not overcome or circumvent Microsoft's 100K limitation on list records, how then could be still utilize this software for our needs?

Are there any other approaches we should consider? I have created a basic, conceptual sample diagram that depicts what I believe is the approach I should take. I would really like some feedback on the best approaches for this type of large undertaking. If you could also offer "pros" and "cons" to my questions as well as for your response answer.

SharePoint with external SQL db diagram

Thanks


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