There are some interesting examples of resizing content panels in Kenny Young's video on Silverlight TV. Check it out. He has some demos (you can grab them from the link) that show how to use panels and as you resize, they animate.

 

http://channel9.msdn.com/shows/SilverlightTV/Creating-Rich-Interactions-Using-Blend-4-Transition-Effects-Fluid-Layout-and-Layout-States-Silverlig/