This seems a VS2010 problem, as the issue does not exist in the designer of VS 2012.
The z-order of the items in the panels is controlled by the Panel.ZIndex property. In Silverlight though, only Canvas has the ZIndex property. That is the reason we are creating telerik:ZIndexManager.ZIndex
that is the same for WPF and Silverlight. As you are using WPF, you can work-around the problem, replacing telerik:ZIndexManager.ZIndex
Property in your theme, with Panel.Zindex
We apologize for any inconvenience caused.
All the best,
the Telerik team