Do you see the view state changing size as you change the number of displayed columns, or does it make no difference? e.g. if you try 1, 2, 5, 10, 50 columns, how does it affect the size?
Also, are you displaying all the rows at once, or are you using paging? e.g. If you only display 10 rows at a time, you should get less much view state than if you display them all.
Note that all this is probably not specific to Dynamic Data, and I suspect you'd see similar behavior with a regular GridView & LinqDataSource.
David