You've probably seen this already, but if not, you should really check out the video preview of Yahoo!'s messenger app built with WPF. http://messenger.yahoo.com/windowsvista.php is the link. I can't wait to see this thing running live. It really seems like they've captured the power of what you can do with WPF.
My team within Microsoft is working on releasing our first beta of Cider, which is a visual designer targetting developers wanting to write cool WPF apps in a WYSIWYG editing environment within Visual Studio 9.0. Our designer will fit in with the rest of the Microsoft Expression technologies, so you'll be able to open your Cider apps in Blend to spice them up with beautiful gradients and animations, but still get your awesome development, layout, and debugging experience within Visual Studio and seamlessly go back and forth between your Expression apps to get your forms looking the way you like.
Of course, after watching this Yahoo! Messenger demo, the question we're all asking is... why not MSN Messenger? Good question. I have no idea. I hope MSN does something sweet, too, otherwise I may have a reason to get an @yahoo email address ;-0.