Duat, a developer on Team Foundation Build, has written a blog post on how to resolve post-upgrade issues with your build workflow if your 2010 build workflow uses custom workflow activities that use the TFS client object model.
Your custom assemblies need update, or else, redirecting
Loading your custom assemblies in the TFS 11 build service process triggers loading TFS 2010 assemblies, and the Workflow Foundation (WF) services are not happy about that. Why?
The build process template, for a particular reason, references the TFS OM assemblies by their simple names. When there are more than one version of the same assembly present in the process, the WF services, while loading and validating the build workflow, attempts to resolve the simple-name references with best effort, and in this case it decides to fail with a namespace ambiguity error.
Here’s what you likely see when this issue occurs:
TF215097: An error occurred while initializing a build for build definition \TFS\Build MAIN: The root element of the build process template found at $/TFS/BuildProcessTemplates/MainDefaultTemplate.xaml (version C182) is not valid. (The build process failed validation. Details: Validation Error: Compiler error(s) encountered processing expression "New Microsoft.TeamFoundation.Build.Workflow.Activities.BuildSettings()".'BuildSettings' is ambiguous in the namespace 'Microsoft.TeamFoundation.Build.Workflow.Activities'.