Rudi Grobler has a short blog post on how to make your ApplicationBar more MVVM friendly.
Source: Rudi Grobler in the Cloud
One of the small issues with using MVVM (Model-View-ViewModel) in a WP7 application is that both ApplicationBarIconButton & ApplicationBarMenuItem do NOT derive from DependencyObject. This means that I can NOT bind to any of its properties, making a “true” MVVM application a little hard! I created 2 simple wrappers for these that make it possible to “bind” to a method.