Updates\Enhancements:

• Breaking Change: Silverlight 3 is now required to develop Silverlight applications.  Silverlight 2 is no longer supported. 
  
  Silverlight 3 introduces major media enhancements, out of browser support allowing Web applications to work on the desktop; significant graphics improvements including perspective 3D graphics support, GPU acceleration and H.264 video support; and many features to improve RIA development productivity. 
  
  You will need to add a reference to the System.Runtime.Serialization library when migrating your ArcGIS Silverlight application to the Silverlight 3 platform.
  
  Element binding was introduced in Silverlight 3 which enables developers to define property relationships to elements in XAML without requiring code-behind. For example the following code can now be used to set the Map property on a Navigation control in XAML (the x:Name attribute on the Map control is set to "MyMap"):
  
  

          <esriToolkit:Navigation Map="{Binding ElementName=MyMap}" />

• Product packaged as a setup executable
  
  At version 1.0, the download on the ArcGIS API for Silverlight/WPF Resource Center consisted of a zip file containing a set of Silverlight and WPF assemblies. With version 1.1 the download is a setup executable. The installation enables the registration and integration of ArcGIS Silverlight and WPF assemblies, components, and templates with Visual Studio 2008 and Expression Blend 3.
  
  
• Design time support in Microsoft Expression Blend 3
  
  A set of integrated features have been added to Expression Blend 3 to enable an ArcGIS Silverlight or WPF developer to drag, drop, and interact with controls, actions and behaviors on an interactive design surface.  A set of dialogs and property pages are included to design and configure components for Silverlight and WPF applications.   See the Working in Expression Blend section for more details.   
  
  
• Silverlight application templates
  
  Two Silverlight templates are available with Expression Blend 3 and Visual Studio 2008. The templates provide a set pre-configured components and styles to create production quality applications quickly and easily.
  
  
• New library ESRI.ArcGIS.Client.Behaviors.dll adds support for interactive behaviors and actions
  
  Microsoft Expression Blend 3 introduces behaviors, which are reusable pieces of packaged code that can be dragged onto any object, and then fine-tuned by changing their properties. Behaviors allow you to add interactivity to your applications without having to write any code. The Behavior API consists of three core classes: Trigger, Action and Behavior. The ArcGIS API for Microsoft Silverlight/WPF includes a set of behaviors and actions to define interactive relationships between user input and Map behavior and content.
  
  Note: To use behaviors and actions in your application, you must add a reference to the System.Windows.Interactivity assembly. This assembly is included with Expression Blend 3 product or the Expression Blend 3 SDK.
  
  
• New FeatureDataGrid and MapProgressBar controls in the Toolkit
  
  The ESRI ArcGIS Silverlight Toolkit includes two new controls to enhance the usability of Silverlight and WPF mapping applications. The FeatureDataGrid provides an interactive view of attributes for graphic features displayed in the map. The MapProgressBar provides visual feedback on the progress of a Map control when retrieving map data. The Toolkit library (ESRI.ArcGIS.Client.Toolkit.dll) is still included with the version 1.1 install.
  
  Note: You must add a reference to the System.Windows.Controls.Data assembly to use the FeatureDataGrid. This assembly is included with the Silverlight
  
  
• Enabled Bing Maps components to work with a local edition of Bing Maps services.
  
  
• Map images generated by ArcGISDynamicMapServiceLayer are returned as mime data. ArcGISDynamicMapServiceLayer uses the export operation to generate an image from a map service instead of exportImage, which returns a url and requires an additional request to retrieve the image.
  
  
• If a layer fails to initialize successfully an error will be thrown. To avoid the error, handle the InitializationFailed event on the layer.
  
  
• To display layers when they initialize, define the startup extent and spatial reference of the map. Otherwise all layers must initialize before any are displayed in the map.
  
  
• ArcGISDynamicMapServiceLayer supports map image output in PNG8 and PNG32 format.
  
  
• ArcGISImageServiceLayer supports map image output in PNG8 format.
  
  
• Mouse wheel events supported in full screen mode.
  
  
• Enabled the ability to change FlareClusterer properties programatically at runtime.
  
  
• Added ability to delay hiding map tips on graphics layer. Use the attached property MapTipHideDelay on a GraphicsLayer or FeatureLayer to define a delay time span.
  
  
• A Bing logo is now visible when Bing layers are displayed in a map.
  
  
• Spatial reference used by Bing layers and components was changed to use WKID 102100. WKIDs 102113 and 3857 are considered equal to 102100.
  
  
• A complete list of public API changes between version 1.0 and 1.1 can be found here.

Resolved bugs:

• Hovering over a graphic sometimes throws a null reference error
• MouseUp event does not fire on GraphicsLayer
• UniqueValueRenderer Property Changed should fire when Infos property is changed
• Error thrown by OverviewMap when changing extent in Map, then immediately loading another container before extent change is finished
• IdentifyTask does not always return all features
• Changing the ControlTemplate of a symbol does not update the graphic
• When Draw object activated\deactivated, map requests images from dynamic ArcGIS Server services
• WPF: Pan animation is not smooth
• WPF: Unable to add controls to WPF ElementHost control in a Windows Form
• WPF: MagnifyingGlass is not clipping properly
• WPF: When updating graphics geometry continuously, display exhibited long lag times
• WPF: Map mouse click event not triggered
• WPF: MapTip position may have a large offset
• WPF: Remove logo from OverviewMap
• WPF: Unable to add items to ElementLayer.Children in XAML
• WPF: Map progress event does not fire with progress equal to 100 after extent change