Installing the 64-bit version of Matlab means you can compile 64-bit .dll's which are compatible with the 64-bit WCF Service Library. This removes the need to compile in 32-bit mode so it doesn't throw exceptions when it calls the 32-bit assembly. This solution works well.
There are two types of projects you can generate in MSVS 2010: "WCF Service Library" and "WCF Service Application". Although you cannot build and run a "WCF Service Library" in 32-bit mode (it only supports 64-bit), you can build and run a "WCF Service Application" in 32-bit mode.