If WriteTransformationsAsElement is true than the transformations are written as inner elements. For example:
<MatrixTransform Matrix="1 0 0 1 10 20"/>
If WriteTransformationsAsElement is false than the transformations are written as attributes. For example:
<Canvas RenderTransform="1 0 0 10 20"...
For Silverlight projects the visual designer in Visual Studio 2010 and Expression Blend may not parse transformations as attributes correctly! It works correctly for WPF projects. So for Silverlight projects it is recommended to write transformations as elements.