An IReportDocument type is needed in order for the WPF Report Viewer to generate a report, therefore the solution would be to use Telerik Reporting as an embedded engine. In the case when you are using a Telerik Reporting WCF service you can only get the rendered report as XAML and there is nobody to serve the resources.
So in this line of thoughts, you should take in consideration that you can use properly only formats with already embedded resources in the files(e.g. PDF and Image format). In order to use other formats you have to handle the resources for them.
About creating a client proxy for your project you can refer to the following "Getting Started Tutorial"
tutorial and especially the "How to: Create a Windows Communication Foundation Client"
the Telerik team