Hi,
the problem you had is likely to be that the PDC VS2005 RC version uses .Net 2.0 Framework v2.0.50727 .
Microsoft Max and the WinFX runtime September CTP were built for .Net 2.0 Framework v2.0.50215 which comes with VS2005 Beta 2.
If you install Max on top of an installation with PDC VS2005 RC it
attempts to put a copy of V2.0.50215 on the machine and fails from what I remember. This then leaves machine in a half and half state and breaks VS2005 RC like you describe.
I was bitten by exactly this myself so for now I have reverted to VS 2005 Beta 2 so everything lives happly together.