After trying for 3-4 hours i go for simple aproach and it works! Here is what i do:
- Go to Add/Remove Program and uninstall all silverlight application, all of them.
- Rebbot my pc, install SL4 tools, SL4 Toolkit and SL4 Developer runtime.
- Make sure that you change the option for SL4 to update its version automatically.
- Another reboot and it's done
I suspect that as i did not change the default setting so SL4 updated itself to SL5 without notifying me :) Make sure to disable automatic updates.