I think I may have found the answer to my question on page 338 of the Solidworks 2009 Simulation manual:
"The majority of the interfaces featured in our model represent shell to solid contact type. It is a rule that local bonded contact is require. Also a shell entity (face or edge) must be Set 1, while faces on the solid components must be Set 2."
I'd appreciate comments to the above and suggestions based on your experiences with sheet metal to solid contacts.