Creating Application Pages for SharePoint
I found this (Excerpt):
Note
You can only design the page in the Source view of the designer. The Design view of the designer is disabled for application pages.
Also found a workaround:
Design View on SharePoint Project Visual Studio 2010Design View on SharePoint Project Visual Studio 2010
here is a trick for this little problem:
add a user control to your project. copy all the markup code over to this user control. design away, then copy the markup back into your application page to start refining your code to work as a sharepoint item.