We have recently had a new line manager start to manage our Scrum team. He is immensely experienced in our field but is relatively inexperienced at Agile/Scrum. He has extensive technical expertise in embedded software (the team's domain) that would go to waste if not utilised properly.
However, the team is wary of making a line manager part of the Scrum team. The general consensus is that the line manager should not be part of the Scrum team at all. There are a number of issues that may crop up, e.g. the team may start "reporting" to the manager (i.e. a daily status update!), the manager may start to micro-manage team members etc etc.
As it currently stands, he has already said that he feels like an outsider within the team. We really want to make use of his technical skills, we'd be foolish if we didn't because we are a relatively inexperienced and young team of twenty somethings.
What would be the best approach to integrate a senior "technical" line manager in a Scrum team and make him feel like he is part of the team?