The 2012 Q1 version does not distribute the implicit styles in a separate folder. So what you have copied from the Themes folder needs to be modified before you can merge it and safely use it in your project.
Please, try replacing the <external:Office_BlueThemeExternal x:Key="Theme" />
with <telerik:Office_BlueTheme x:Key="Theme" />
at all occurences in your copied resource dictionary.
Also delete the external namespace declaration as you do not need it:
Upgrading will help in that it will provide you with ready-to-use xaml files with implicit styling
you can find more information on the implicit styles we introduced.
However, if you have made significant changes to your current xaml you do not necessarily need to upgrade just now.
Hope this helps.
the Telerik team
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