I was doing some more catch-up reading and came across another interesting tidbit of information in an MSDN Build Automation forum post.
The author of the post was building a workspace by hand using an
The answer, it seems, is that the dev team that built TF.exe made it really smart. It checks to see if it is running in an interactive (command prompt) or non-interactive( team build, etc.) session. If it is running non-interactive it automatically sets the noprompt option for you.