Using the Business Application template from the brand new released RIA Services, you can see lots of examples using the data grid on top of a DomainDataSource
It's called stealth paging. Component One has a sample of their DataGrid that uses Stealth Paging. As soon as you scroll down, it gets the next page.
http://demo.componentone.com/Silverlight/ControlExplorer/#DataGrid/Stealth%20Paging
Shows the demo, and you can download the sample which show the code.
Hope this helps,
Greg