Mike - I have been answering you on the cakewalk forum, but since you posted here as well I thought I'd share my answers here also for the benefit of others who might be reading this.

MC5 (all previous versions of MC as well) does not support custom INS DEF. you have to upgrade to Sonar Home Studio, Sonar Studio or Song Producer version for INS DEF support.

however, as I explained there, that doesn't mean you can't use the SD2. all it means is that you have to choose the patches by NUMBER instead of by NAME. that just means you have to look at your manual for the SD2 and match the patch name to the bank/patch number and choose that bank/patch number in MC instead of seeing the patch name in the choices.