Visual Web Developer is not really for working with php pages. As you noticed it will basically work as a fancy notepad.
Visual Web Developer is for building ASP.NET webapplications. If you want to use the full power of VWD you will have to rebuild your whole site. It will also require that your webhosting supports ASP.NET.
I have not used php for a long time so I have no tip on any editors to use. You might want to start looking at http://www.php.net/support.php
The Visual Web Developer and ASP.NET forums are at http://forums.asp.net
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