Here is the quick start for Silverlight. Follow the instruction you should be able to create your silverlight project and Web project.
http://silverlight.net/quickstarts/managed.aspx
You can use Server side code to build pages, and put client side code on your page. The client side code will be running on the client side like javascript. But you never compile the server side code and client side code into one DLL. That's I meant you can not mix them up.
When we talk about silverlight 2 development most people here are taking the advantage of managed code silverlight 2 provide to write their silverlight application in C# or VB. So the code will be compiled into a .XAP file. When you create a silverlight link to your Web project the XAP file will be copied to your web project ClientBin folder. The code for your web project running on the Server will still be in the Bin folder. The Xap file will be downloaded to the client side when user hit the page and be running there.
The code in silverlight project can only access the Silverlight runtime DLL which is a sub set of the WPF and common .Net Framework. But the server side code in your Web Project can access the full set of the .Net Framework.
Software Engineer
Aprimo, Inc
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