... at least partially.
After looking at the FSharp.Data library and its source on github, I found that the
Json type provider clarified the most important point.
Namely:
I'm not sure if this design-only type has inadvertently "leaked" into the runtime, or if any code used by the type provider must be present in the run-time component.
It is not the case that all code in the type provider in the design-time component needs to also be in the run-time/reference component. I'm not entirely sure what was the problem in my code, but an AutoOpen attribute on the internal module containing utility types in the type provider might have been the culprit.
In other words, the design-time component can use any crazy library you might find useful to generate the code. As long as it's not also used in the generated code, you won't need to have the run-time component include the crazy library in its dependencies. Nice!
Another potentially valid use case I've encountered is to avoid generating code at all when the design-time component is being used by and IDE, for auto-completion. Considering the kind of responsiveness requirements this use case has, leaving out complex generated code is probably a good idea. I'm not sure if that's supported by the existing framework. It sounds like it's something that TypeProviderConfig could take care of, and maybe that's what IsHostedExecution is for.
That's not what IsHostedExecution does. It tells you
whether to use the resolution folder at run-time.