Deploying applications through Visual Studio or Application Deployment tool causes error.

This prevents from launching applications with debugger attached.
Empty project seems to go through this procedure without errors.

Steps to reproduce:
1. Build AngryBots to a folder
2. Open build solution with Visual Studio
3. Deploy it with debugger attached or use Application Deployment tool to deploy built xap
4. Error will be shown:
Error 1 Deployment failed with error: '0x80070126'. Please try again. If the problem continues, try restarting your Windows Phone and repairing Visual Studio for Windows Phone.
However, the project actually gets deployed.