The Telerik Reporting WCF Service
enables the remote access to the Telerik Reporting Engine and acts as a communication interface between the client programs and the report server. As any standard WCF service, it has 2 endpoints - one for the data and one for the resources. Images are resources, so they are streamed through the resource endpoint - please see the following help article for sample configuration: Hosting WCF Service in IIS
. If images are missing in the report in Silverlight viewer, most likely the WCF service is not configured properly, specifically the resource endpoint, so review the referenced threads carefully. To make sure this is not a configuration problem, you can place your report in our Silverlight demo app we provide and run it directly there. You can then compare the configuration and update your project accordingly.
the Telerik team