Silverlight only for the client applications at this point. We do support creating an out of browser client application (in fact that is the default) which runs in the extended sandbox giving the application access to desktop resources (file system, devices,
COM interop with other applications).
We focused on the ability to control the functionality of the application and/or implement business logic and rules based on the current user of the application. In LightSwitch you define the set of permissions ("CanApproveOrder", "CanPromoteEmployee") you need
and write code to implement your custom logic based on those permissions (User.HasPermission(CanApproveOrder)).
LightSwitch applications include built in support for creating and managing the user->role and role->permission relationships.