I've done some digging on this, and here are my findings on this.
ADO.NET Data Services:
You can use ADO.NET Data services (you need SP1) to expose your Entity framework over the wire, with almost zero code. But as I understand, the only limitation is, the transaction is over HTTP. That means, there is a small over head in terms of serialization (we all know binary serialization is faster), but the advantage is the speed of implementation for our services.
I got an unofficial word from John [http://twitter.com/John_Papa] on this - "Definitely more options with wcf. More work in most cases too. Astoria exposes entities easily. Perf diffs are negligible in most cases"
The advantages - You don't really need to write any services at all - You can just hook the validation and security logic around the data services and entity framework and we are done. Ideal if you are consuming data centric services over http - in scenarios like having a silverlight client, or a winform/wpf front end over http.
Exposing Entity Framework over WCF:
With SP1, there is lot of support for employing entity framework in layered architectures. This includes support for eager loading and context management. Of course, in this case, we need to write the services (and the logic behind our methods). Or if we have the entity framework model totally alligned with the db, we could generate most of the services, which includes the methods we need.
Recommending you to read this http://msdn.microsoft.com/en-us/magazine/cc700340.aspx
Another alternative might be to use EFPocoAdapter, to have a plain POCO wrapper on top of the entity framework for dtos, instead of exposing entity framework classes directly. Right now it is a compass project for next version of Entity framework http://code.msdn.microsoft.com/EFPocoAdapter.