In this post Andy Beaulieu explains how by using
obfuscation you can make it a little bit more difficult for people to copy your Silverlight application logic.
You might be aware that when you publish a Silverlight XAP on the web, your source code is very vulnerable to prying eyes. A XAP file is in a ZIP compressed format, and the contents are .NET Assemblies and resources which can be disassembled easily using a tool like .NET Reflector .