Unfortunately, there will not be a bluetooth API in the first release of the Windows Phone 7 app platform. This is something we've heard a lot of feedback on and very high in the priority list for future versions.
I like the c# deal. Does that mean I don't need any jScript at all?
Which appear to be what is used to embed WPF/E content in a web page.
That is correct. WPF/E uses an ActiveX control in IE. Automatic activation can be accomplished usiing a document.write or setting the innerHtml on an element. This is what the WPF/E demos in the video used. For more info on activation, see
this MSDN topic.