This is the second time that I have this really weird problem with WCF RIA Services! the sad thing is that I had to solve the problem twice, going through the different hoops again :(, even though I've left a note to myself pointing to the solution :P
Anyways, the "pretty useful" error message is the following:
...\MSBuild\Microsoft\Silverlight\v4.0\Microsoft.Ria.Client.targets(304,5): error : The code generator 'Microsoft.ServiceModel.DomainServices.Tools.CSharpCodeDomClientCodeGenerator' encountered a fatal exception and could not generate code for project "ProjectA"