Design View for Xaml on Visual Studio Professional RC 2012 used to work for me. But suddenly stopped for no reason I can figure.
Check the following:
Tools
-> Options
Text Editor
-> XAML
-> Miscellaneous
Or perhaps the default program for opening .xaml
files has changed:
.xaml
file in Solution Explorer Open With...
XAML UI Designer
Set as Default
button OK
EDIT
This does appear to be a known bug with an earlier version of VS11.