Are there any pitfalls to using an IEnumerable return type for SQL data?

I wouldn't use it, because it hides what's happening, and it could possibly leave database connections without proper disposal.

This is not a pattern I would follow. I would not worry as much about load on the server as I would about locks. Following this pattern integrates the data retrieval process into your business logic flow, and that seems like an all-around recipe for trouble; you have no idea what happens on the iteration side, and you're inserting yourself into it.

Retrieve your data in one shot, then allow the client code to enumerate over it once you've closed the reader.

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