What are the differences between XBAP and WPFE ?
XBAP is Windows only and requires .Net 3 Framework to be installed on your machine. It is used for creating heavyweight .Net applications that take advantage of the full capabilities of .Net 3 Framework.
WPF/E is a small component (~1MB) that is plugged into the browser. It is cross platform and does not require the installation of .Net 3 Framework.
WPF/E supports only a subset of XAML. You may think of WPF/E as Microsoft’s equivalent to Flash Player.