If you went through the trouble of setting up a development environment with Visual Studio 2010 Beta 2 and Silverlight 4 Tools for Visual Studio 2010 Beta 2 you should probably know that the installation of will not copy correctly one of the most important assemblies for Linq to XML, the System.Xml.Linq.
Also, trying to add it via project References will do no good either as it is not present there either. But you do find that assembly in <System Drive>:\Program Files (x86)\Microsoft SDKs\Silverlight\v4.0\Libraries\Client. (For X86 installations do change to the Program Files.
One more thing, if you are eager to try Visual Studio 2010 RC1 that Microsoft has been publishing not so long ago, you should know that Silverlight 4 is not supported in this release. At the same time it looks like is more and more difficult to get your hands on the Beta 2 version of Visual Studio 2010, so if you have one around, make sure you don’t delete it.
Hope it helps,