Firstly I'd be interested in how the data is encrypted and if it could be
easily decrypted by having total rights to the instance - ie are the
decryption routines held in the instance? If the developers wrote the
encryption routines outside of SQL Server and you have access to this code
then this is a bit academic anyway :)

Next I'd look at how you could interact with the rest of your network.
Access to xp_cmdshell and sp_OA.... procedures could be a problem if run in
the context of a domain admin, which is the login used on a lot of SQL
installations I've seen. Finally I'd look at any linked servers that are set
up - total access to these could be an issue - just depends which systems
they are pointing at.

Cheers,
Paul Ibison

Depends how your developers work. If they use their own logins to do unit
tests on the dev server then those logins ought to be given only the roles
they have in production. If they have separate logins for testing then maybe
that's not a problem.

I'm a little sceptical about what you mean by "scrambling" sensitive data
though.