For an explanation of what an Xbap is, look at a previous blog of mine.
I have spent the last few weeks writing a Xbap (or page navigation) application in WPF.
The first thing you have to get used to is that you need to forget Windows, everything is in terms of pages.
What is a page?
Actually it looks stunningly similar to a WPF Window.
You get to use exactly the same xaml markup constructs, dockpanels, textboxes etc etc.
The advantage of Xbaps over normal WPF application is that they run in the browser (firefox as well as internet explorer) and yet you still get all of the great WPF goodies, including animations and styles.
The only restrixtion is that they need to run under partial trust rather than full trust.
What does that mean in practice?
It means that whatever zone you pick for your xbap application confines its functionality.
For example, an internet zone xbap cannot access the local file system or the registry – which is only logical