I faced that error while building a WP7 app after doing some reorganization of files within the solution.
VS2010 didn’t give any pointers, so i turned to Google and found this post in Jayway Team’s blog. My problem was not exactly the same, but that post pointed me to the right direction. Thank you to Jayway Team!
I had accidentally moved the default “ApplicationIcon.png” and “BackGround.png” from the root of the solution to a resources folder. After a bit of digging around the solution, i found the references to those images in the WMAppManifest.xml-file located within properties folder.
Issue went away by altering the paths. Really simple, but why-oh-why VS couldn’t give me any useful information right at the beginning…