Embedded Database or runtime solution

Hello,
Im doing research for my company for a project we are about to start, but the more I find, the more Im confusing myself. Maybe someone would be so nice to help me a little.

We need a database solution, either licensing (ISV) or i think maybe an embedded database. if its licensing, its not a problem, but after research, im thinking licensing would be a waste of time or too much and theire not enough information to go by just that.

Problem: Need to develop software for a client where there will be around 300 users using the system (not all at once neccisarrily). We are creating this software for them and they want to re-sell it after completion, but they do not want to make their customers purchase a database for the purchase of their software. (because of all types of licensing). We need the database RUNTIME to run on the customers machine to make the software work.

Is there a RUNTIME license for Independant-Software-Vendor(IVS) for redistribution? or would it make sense to embed a database ( for example, the free edition of sql server;embeeded feature :), or maybe firebird embedded database?) We are developing in Visual Studio 2005.

This might sound confusing, thats where im at. For those of you with more experience, hopefully you understand what im talking about.

Thank you. I have 2 days to find a solution. Ill continue looking and post in thread if i find anything new or clearify my problem.You've probably already had to turn your assignment in, but you've got a bunch of choices. The problem is that licensing is like playing pickup sticks with eels. They're slippery, they often move on their own, and they're tough to stack at the best of times.

-PatP