Allow testers to open test cases in Excel and edit them and sync them back into MTM. It would also be nice if I could mark test case pass/ fail status in Excel and upload to MTM directly

Enhance Coded UI Test to include the many common features found in commercial-off-the-shelf software test automation packages like SmartBear's Test Complete. These packages typically feature very rich functionality in mapping and managing UI control objects, whereas Coded UI does not. Packages like Test Complete also boast an impressive list of technologies with which it is compatible. Coded UI is limited in this respect as well.

Actually you can make suites based on query.
But it would be nice make a suite based on a "Workitem and direct links" query (for example all the test case that don't have a bug in active state).

After a test has been loaded into Test Runner, I often find that I have to make some changes to the test case while running it (some build changes, some corner cases etc). It is painful to switch back and forth between MTM (to edit test cases) and Test Runner (to run tests).

UL

MTM provides the ability to pause a test case, but I cannot run any other test case (or else the paused test case data is lost). I can only resume the paused test or discard it to create a new one.
Testers would like to execute on a particular test case for a while, if they face a blocker, they should pause this test case and pick up others for testing. Later, they should be allowed to resume the paused test case

MTM should allow parameters for a test case to be picked up from a csv file or an Excel file

I should be able to find out all the test plans/ test suites in which a given test case is used

I can use parameters while creating action recording and playback for text fields and drop down elements. This does not work for check boxes or radio buttons (For example, if I create a parameter with value "Yes" and use that for a check box, the binding does not work)

If some test for some reason doesn't cleanup its playback(Playback.CleanUp()) the Test Agent which run the test becomes unusable until its restarted or QTAgent is killed. In Visual Studio 2010 there is an option "Keep test execution engine running between runs" it will be very useful if its possible to set this on the Test Agents or Test Controllers.

It will be a better feature to choose a different UIMap when you create a coded UI test from an existing recording or Test and Lab manager. Currently, you have to edit the UIMap to move some code in another UIMap and it's not very funny !

I would like to customize a test plan and add new fields to it. I should be able to customize test result values - like adding Not Applicable to passed/ failed/ blocked. I should be able to customize the test failure reason on a failing test case

When test plan is defined it would be nice to have ability to order test suites in it as you can order test case in test suite (ability to edit SequenceNumber from table tbl_SuiteEntry for suites)

Currently it is very unpredictable which monitor will be recorded when using the video recording feature. It is very easy to record sensitive information such as the testers personal email.

By default it should only record the monitor that test runner is on but this should be configurable incase testers use a different monitor for the Application Under Test

Ideally it should be more obvious which monitor is being recorded. A slight red glow around the monitor in question when recording would be nice.

Currently we need to go quite some lengths in order to extend and customize the Microsoft Test Manager functionality (Planning, edition and running tests) because the functionality mtm(.exe) provides only overlaps to a certain extend to our usecases and right now it offers no public API which we can build upon.