Well I spent a day or so working on this for a pet project. I was able to get this working with Sql Server Compact 3.5 and iBatis.Net 1.6.2 on .Net Framework 4.0. If you wanted it to run on a different version you'll need to update the Version and PublicKeyToken of the parameterDbTypeClass attribute.
You just need to add the following to your provider.config file.
<provider
name="sqlServerCompact3.5"
enabled="true"
description="Microsoft SQL Server Compact 3.5, provider V3.5.1.0 in framework .NET V2.0"
assemblyName="System.Data.SqlServerCe, Version=3.5.1.0, Culture=neutral, PublicKeyToken=89845dcd8080cc91"
connectionClass="System.Data.SqlServerCe.SqlCeConnection"
commandClass="System.Data.SqlServerCe.SqlCeCommand"
parameterClass="System.Data.SqlServerCe.SqlCeParameter"
parameterDbTypeClass="System.Data.SqlDbType, System.Data, Version=4.0.0.0, Culture=neutral, PublicKeyToken=b77a5c561934e089"
parameterDbTypeProperty="SqlDbType"
dataAdapterClass="System.Data.SqlServerCe.SqlCeDataAdapter"
commandBuilderClass=" System.Data.SqlServerCe.SqlCeCommandBuilder"
usePositionalParameters = "false"
useParameterPrefixInSql = "true"
useParameterPrefixInParameter = "true"
parameterPrefix="@"
allowMARS="false"
/>