Bruce Zhang has put together a great post about stream operations in WCF.

I have never liked the limitations imposed with streaming in WCF although I do agree with the design. The biggest issue for me is that WCF needs to be configured for a maximum transfer size. The main problem here is that a service and a client will probably not know the maximum size of data that a service could process. To know the maximum size would require a business rule in the service design and that would not be very common for a service that handles large amounts of data via a stream.

I prefer a chunking service design as you get around all of these limitations with the one disadvantage of creating a chatty service. This introduces a little overhead but I think it is worth it for the benefit of avoiding WCF streaming restrictions.