My organization is considering which technologies to use for our next generation of systems. We will be using .NET, but have not decided which user interface technology is b
Silverlight is far less capable than WPF, even in version 4.
It can run in a browser or out of browser, and has some advantages - but the main advantages of Silverlight over WPF are deployment related. It is very easy to deploy a Silverlight application - just refer to the XAP in a webpage located on your server, and it's deployed (provided your users have Silverlight installed). WPF requires a bit more work in terms of deployment, since it's a full desktop application.
That being said, WPF provides far more capabilities. It provides access to the full .NET framework (as opposed to a [growing] subset).
My personal preference would be to use Silverlight - provided the application did not require interop with legacy software, access to resources on the system, or other things unavailable within Silverlight. If, however, you need to do anything that will tax the system (ie: heavy computation where you want parallelism, use of graphics resources, complex 3D work, etc), then WPF is the way to go.