Is it possible to have HTML appearing above embedded Silverlight?
Yes but you need to set the windowless param to true on the Silverlight object tag so that it can render behind other HTML objects.
Anthony is right - I've shown a code snippet here on my blog. You need to implement the in your object element and then use CSS Z-index.
More info about layering HTML elements on top of or underneath your Silverlight control here: http://weblogs.asp.net/jgalloway/archive/2008/02/15/using-windowless-silverlight-controls-to-blend-html-and-silverlight-elements.aspx
Note that there are performance impacts in using windowless and/or transparent controls since it requires more frequent redrawing, so it's not recommended for animation or video playback.
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