Silverlight 3 has the new WriteableBitmap which allows you to take UIElements and then ask them to render into a bitmap and it also allows you to manually create bitmaps from code.

What it doesn’t allow you to do in the current beta is to do very much with those bitmaps once you’ve created them. That is…you can’t get access to the pixels in order to, for example, write them to a file or send them to a web service.

There’s a thread over here on the Silverlight forums which covers it off in detail.