Suppose a project has both App.config and Web.config files with some conflicting information. Are there any rules which of the files has higher priority? Or an application has to disregard both of them and throw an exception?
From MSDN for .NET 4.5:
When configuring a service in Visual Studio, use either a Web.config file or an App.config file to specify the settings. The choice of the configuration file name is determined by the hosting environment you choose for the service. If you are using IIS to host your service, use a Web.config file. If you are using any other hosting environment, use an App.config file.
In Visual Studio, the file named App.config is used to create the final configuration file. The final name actually used for the configuration depends on the assembly name. For example, an assembly named "Cohowinery.exe" has a final configuration file name of "Cohowinery.exe.config". However, you only need to modify the App.config file. Changes made to that file are automatically made to the final application configuration file at compile time.
In using an App.config, file the configuration system merges the App.config file with content of the Machine.config file when the application starts and the configuration is applied. This mechanism allows machine-wide settings to be defined in the Machine.config file. The App.config file can be used to override the settings of the Machine.config file; you can also lock in the settings in Machine.config file so that they get used. In the Web.config case, the configuration system merges the Web.config files in all directories leading up to the application directory into the configuration that gets applied. For more information about configuration and the setting priorities, see topics in the System.Configuration namespace.
Here's also a great post for those using MS Azure, explaining the differences b/w ApplicationSettings, appSettings (app.config/web.config) and ConfigurationSettings (.csdef / .cscfg):
http://haishibai.blogspot.com/2012/09/windows-azure-cloud-service.html
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