This question has been answered many times since Microsoft presented his beta during the Mix 2007. Many of you are waiting from about 2 years to have a first build available to start working and I think that many of you thinked that this project is dead due to the long time passed from its presentation.
Today Bart Czernicki has published a post about this argument that resume the history of this platform and switch on some light about the future of Silverlight Mobile. The last sentence of his post is the more interesting:
This makes Silverlight mobile being released in line with the Windows 7 mobile platform. I am hoping we see a beta/CTP around the Visual Studio 2010 release.
Hoping that Bart is right on the supposed timing I leave you to the reading of his interesting post.
Link: Silverlight 3 - Where is Silverlight Mobile?