See Reed answer - Kit3D is your best bet (be it Silverlight 2.0 or 3.0) - check out a few examples .
If you read about the new β3D features of Silverlight 3.0,β this is not a complete 3D system (a-la WPF), but a new type of Transform that (basically) βcreates a flat surface in 3D space.β
It is called PlaneProjection and allows you to do something like this and this . It is great for flipping things (like carousel controls) and similar effects (also implementing Photosynth, where deep images should be placed in β3Dβ), but CANNOT be able to render a 3D model as such.
If you decide to play with Kit3D (or WPF 3D), Charles Petzold really helped me understand the basics of all this ...
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