In your output window you may find something like:
Deploying C:\Users\Username\Documents\Visual Studio 2010\Projects\MyApp\MyApp\Bin\Debug\MyApp.xap…
Deployment of application to device failed.
The parameter is incorrect.
The problem is probably due to the ApplicationIcon.png or Background.png files. These files must be actual files within the project – they can’t be linked to.
Another problem can be an incorrectly formatted WMAppManifest.xml file. Create a dummy project so you can compare your manifest file to the freshly created correct manifest. Pay particular attention to the Genre (must be ‘apps.normal’) and the IconPath and BackgroundImageURI values. Also make sure the DefaultTask’s ‘NavigationPage’ is set correctly.
And another cause may be that you have a debugging session running in Visual Studio, and try to deploy the very same app via app deployment tool.
I came to love these explicit error messages!