Question: Where would the physical files be?

Answer: 
`%LocalAppData%\IsolatedStorage` / `%AppData%\IsolatedStorage.`

I didn't find them under "Microsoft"
On my XP workstation I found it under c:\Documents and Settings\\Local Settings\Application Data\Microsoft\Silverlight\is\XXXXXXXXXXXXX
Where xxxxxxxx appears to be a random directory name. (under that if you wander around enough you should find the store for your particular app...)