This blog post was very helpful to me in resolving this issue. Please give a try. Hope it helps.
http://cherupally.blogspot.com/2009/04/solving-error-2104-could-not-download.html
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addressing technical problems/issues facing in Dot Net, C# and Sql server
Works like a charm.
Maybe only with
.xaml application/xaml+xml
.xap application/x-silverlight-app
would work fine, but… it’s ok.
For me, it works by defining all the MIME tipes right in the “Web Sites” node of IIS. They would extend to de lower nodes.
I didn’t have to do this on my workstation (windows xp) and when I look at the iis mime types I do not see .xap or .xaml but the application works.
However, when I deploy to my server machine (a windows 2003 64bit machine) I get this error.
Is there something regarding automatic mime-type settings by silverlight installer that I may be missing.
Any differences due to my OS?