mainwindow.xaml

<Window x:Class="WpfApplication1.MainWindow"
        xmlns="http://schemas.microsoft.com/winfx/2006/xaml/presentation"
        xmlns:x="http://schemas.microsoft.com/winfx/2006/xaml"
        Title="MainWindow" Height="350" Width="460">
  <StackPanel Orientation="Horizontal">
    <StackPanel Orientation="Vertical" Width="160">
      <Button x:Name="StartButton" Content="Start Python"/>
      <TextBlock x:Name="Status"/>
    </StackPanel>
    <ContentControl Grid.Column="1" x:Name="PythonWinHost" Width="300"/>
  </StackPanel>
</Window>

mainwindow.xaml.cs

using System;
using System.Diagnostics;
using System.Runtime.InteropServices;
using System.Threading;
using System.Windows;
using System.Windows.Interop;
using System.Windows.Threading;
using IronPython.Hosting;

namespace WpfApplication1
{
  public static class User32
  {
    public const int WS_CHILD = 0x40000000;
    public const int WS_CAPTION = 0x00C00000;
    public const int WS_THICKFRAME = 0x00040000;
    public const int GWL_STYLE = -16;

    [DllImport( "user32.dll" )]
    public static extern int GetWindowLong( IntPtr hWnd, int nIndex );

    [DllImport( "user32.dll" )]
    public static extern int SetWindowLong( IntPtr hWnd, int nIndex, int dwNewLong );

    [DllImport( "user32" )]
    public static extern IntPtr SetParent( IntPtr hWnd, IntPtr hWndParent );
  }

  public class WpfHwndEmbedHost : HwndHost
  {
    private readonly IntPtr childWin;

    public WpfHwndEmbedHost( IntPtr childWin )
    {
      this.childWin = childWin;
    }

    protected override HandleRef BuildWindowCore( HandleRef hwndParent )
    {
      int style = User32.GetWindowLong( childWin, User32.GWL_STYLE );
      style = style & ~User32.WS_CAPTION & ~User32.WS_THICKFRAME;
      style |= User32.WS_CHILD;

      User32.SetWindowLong( childWin, User32.GWL_STYLE, style );
      User32.SetParent( childWin, hwndParent.Handle );

      this.InvalidateVisual();

      return new HandleRef( this, childWin );
    }

    protected override void DestroyWindowCore( HandleRef hwnd )
    {
    }
  }

  public partial class MainWindow : Window
  {
    private const bool hostedWin = true;
    private readonly Dispatcher mainDispatcher;
    private Dispatcher pyDispatcher;
    private Thread procThread;

    public MainWindow()
    {
      InitializeComponent();
      DataContext = this;
      mainDispatcher = Application.Current.Dispatcher;
      Status.Text = "Ready";
      StartButton.Click += ( sender, args ) => StartPythonThread();
    }

    private void StartPythonThread()
    {
      var thr = new Thread( PythonThread ) { IsBackground = true, Name = "Python" };
      thr.SetApartmentState( ApartmentState.STA );
      thr.Start();
    }

    private Window CreateWindow()
    {
      var win = new Window();
      win.Show();
      if( hostedWin )
      {
        var hostedWinHandle = new WindowInteropHelper( win ).Handle;
        mainDispatcher.Invoke( () => { PythonWinHost.Content = new WpfHwndEmbedHost( hostedWinHandle ); } );
      }
      return win;
    }

    private void StartProcessThread()
    {
      procThread = new Thread( ProcessThread ) { Name = "Process" };
      procThread.Start();
    }

    private bool ProcessRunning()
    {
      return procThread != null && procThread.IsAlive;
    }

    private void ProcessThread()
    {
      mainDispatcher.Invoke( () => { Status.Text = "Process start"; } );
      Thread.Sleep( 5000 );
      mainDispatcher.Invoke( () => { Status.Text = "Process done"; } );
    }

    private void PythonThread()
    {
      pyDispatcher = Dispatcher.CurrentDispatcher;
      Debug.Assert( !ReferenceEquals( pyDispatcher, Application.Current.Dispatcher ) );
      SynchronizationContext.SetSynchronizationContext( new DispatcherSynchronizationContext( pyDispatcher ) );

      var py = Python.CreateEngine();
      var scope = py.CreateScope();
      ( (dynamic) scope ).createWindow = new Func<Window>( CreateWindow );
      ( (dynamic) scope ).startProcess = new Action( StartProcessThread );
      ( (dynamic) scope ).processRunning = new Func<bool>( ProcessRunning );
      ( (dynamic) scope ).runDispatcher = new Action( Dispatcher.Run );
      py.Execute( script, scope );
    }

    private const string script =
@"
import time
import clr
clr.AddReference( 'PresentationFramework' )
clr.AddReference( 'PresentationCore' )
from System.Windows.Controls import Button

def RunIt( s, e ):
  startProcess()
  time.sleep( 1.5 ) #make sure proc thread started...
  while processRunning():
    time.sleep( 0.5 )

b = Button()
b.Content = 'Start Process'
b.Click += RunIt
win = createWindow()
win.Content = b
runDispatcher()
";
  }
}

wpfapplication1.csproj

<?xml version="1.0" encoding="utf-8"?>
<Project ToolsVersion="4.0" DefaultTargets="Build" xmlns="http://schemas.microsoft.com/developer/msbuild/2003">
  <Import Project="$(MSBuildExtensionsPath)\$(MSBuildToolsVersion)\Microsoft.Common.props" Condition="Exists('$(MSBuildExtensionsPath)\$(MSBuildToolsVersion)\Microsoft.Common.props')" />
  <PropertyGroup>
    <Configuration Condition=" '$(Configuration)' == '' ">Debug</Configuration>
    <Platform Condition=" '$(Platform)' == '' ">AnyCPU</Platform>
    <ProjectGuid>{F3304AF0-F1E8-45EB-A6E0-C480D2909B30}</ProjectGuid>
    <OutputType>WinExe</OutputType>
    <AppDesignerFolder>Properties</AppDesignerFolder>
    <RootNamespace>WpfApplication1</RootNamespace>
    <AssemblyName>WpfApplication1</AssemblyName>
    <TargetFrameworkVersion>v4.5</TargetFrameworkVersion>
    <FileAlignment>512</FileAlignment>
    <ProjectTypeGuids>{60dc8134-eba5-43b8-bcc9-bb4bc16c2548};{FAE04EC0-301F-11D3-BF4B-00C04F79EFBC}</ProjectTypeGuids>
    <WarningLevel>4</WarningLevel>
  </PropertyGroup>
  <PropertyGroup Condition=" '$(Configuration)|$(Platform)' == 'Debug|AnyCPU' ">
    <PlatformTarget>AnyCPU</PlatformTarget>
    <DebugSymbols>true</DebugSymbols>
    <DebugType>full</DebugType>
    <Optimize>false</Optimize>
    <OutputPath>bin\Debug\</OutputPath>
    <DefineConstants>DEBUG;TRACE</DefineConstants>
    <ErrorReport>prompt</ErrorReport>
    <WarningLevel>4</WarningLevel>
  </PropertyGroup>
  <PropertyGroup Condition=" '$(Configuration)|$(Platform)' == 'Release|AnyCPU' ">
    <PlatformTarget>AnyCPU</PlatformTarget>
    <DebugType>pdbonly</DebugType>
    <Optimize>true</Optimize>
    <OutputPath>bin\Release\</OutputPath>
    <DefineConstants>TRACE</DefineConstants>
    <ErrorReport>prompt</ErrorReport>
    <WarningLevel>4</WarningLevel>
  </PropertyGroup>
  <ItemGroup>
    <Reference Include="IronPython, Version=2.7.0.40, Culture=neutral, PublicKeyToken=7f709c5b713576e1, processorArchitecture=MSIL">
      <SpecificVersion>False</SpecificVersion>
      <HintPath>packages\IronPython.2.7.4\lib\Net45\IronPython.dll</HintPath>
    </Reference>
    <Reference Include="IronPython.Modules, Version=2.7.0.40, Culture=neutral, PublicKeyToken=7f709c5b713576e1, processorArchitecture=MSIL">
      <SpecificVersion>False</SpecificVersion>
      <HintPath>packages\IronPython.2.7.4\lib\Net45\IronPython.Modules.dll</HintPath>
    </Reference>
    <Reference Include="IronPython.SQLite">
      <HintPath>packages\IronPython.2.7.4\lib\Net45\IronPython.SQLite.dll</HintPath>
    </Reference>
    <Reference Include="IronPython.Wpf">
      <HintPath>packages\IronPython.2.7.4\lib\Net45\IronPython.Wpf.dll</HintPath>
    </Reference>
    <Reference Include="Microsoft.Dynamic, Version=1.1.0.20, Culture=neutral, PublicKeyToken=7f709c5b713576e1, processorArchitecture=MSIL">
      <SpecificVersion>False</SpecificVersion>
      <HintPath>packages\IronPython.2.7.4\lib\Net45\Microsoft.Dynamic.dll</HintPath>
    </Reference>
    <Reference Include="Microsoft.Scripting, Version=1.1.0.20, Culture=neutral, PublicKeyToken=7f709c5b713576e1, processorArchitecture=MSIL">
      <SpecificVersion>False</SpecificVersion>
      <HintPath>packages\IronPython.2.7.4\lib\Net45\Microsoft.Scripting.dll</HintPath>
    </Reference>
    <Reference Include="Microsoft.Scripting.AspNet">
      <HintPath>packages\IronPython.2.7.4\lib\Net45\Microsoft.Scripting.AspNet.dll</HintPath>
    </Reference>
    <Reference Include="Microsoft.Scripting.Metadata, Version=1.1.0.20, Culture=neutral, PublicKeyToken=7f709c5b713576e1, processorArchitecture=MSIL">
      <SpecificVersion>False</SpecificVersion>
      <HintPath>packages\IronPython.2.7.4\lib\Net45\Microsoft.Scripting.Metadata.dll</HintPath>
    </Reference>
    <Reference Include="System" />
    <Reference Include="System.Data" />
    <Reference Include="System.Xml" />
    <Reference Include="Microsoft.CSharp" />
    <Reference Include="System.Core" />
    <Reference Include="System.Xml.Linq" />
    <Reference Include="System.Data.DataSetExtensions" />
    <Reference Include="System.Xaml">
      <RequiredTargetFramework>4.0</RequiredTargetFramework>
    </Reference>
    <Reference Include="WindowsBase" />
    <Reference Include="PresentationCore" />
    <Reference Include="PresentationFramework" />
  </ItemGroup>
  <ItemGroup>
    <ApplicationDefinition Include="App.xaml">
      <Generator>MSBuild:Compile</Generator>
      <SubType>Designer</SubType>
    </ApplicationDefinition>
    <Page Include="MainWindow.xaml">
      <Generator>MSBuild:Compile</Generator>
      <SubType>Designer</SubType>
    </Page>
    <Compile Include="App.xaml.cs">
      <DependentUpon>App.xaml</DependentUpon>
      <SubType>Code</SubType>
    </Compile>
    <Compile Include="MainWindow.xaml.cs">
      <DependentUpon>MainWindow.xaml</DependentUpon>
      <SubType>Code</SubType>
    </Compile>
  </ItemGroup>
  <ItemGroup>
    <Compile Include="Properties\AssemblyInfo.cs">
      <SubType>Code</SubType>
    </Compile>
    <Compile Include="Properties\Resources.Designer.cs">
      <AutoGen>True</AutoGen>
      <DesignTime>True</DesignTime>
      <DependentUpon>Resources.resx</DependentUpon>
    </Compile>
    <Compile Include="Properties\Settings.Designer.cs">
      <AutoGen>True</AutoGen>
      <DependentUpon>Settings.settings</DependentUpon>
      <DesignTimeSharedInput>True</DesignTimeSharedInput>
    </Compile>
    <EmbeddedResource Include="Properties\Resources.resx">
      <Generator>ResXFileCodeGenerator</Generator>
      <LastGenOutput>Resources.Designer.cs</LastGenOutput>
    </EmbeddedResource>
    <None Include="packages.config" />
    <None Include="Properties\Settings.settings">
      <Generator>SettingsSingleFileGenerator</Generator>
      <LastGenOutput>Settings.Designer.cs</LastGenOutput>
    </None>
    <AppDesigner Include="Properties\" />
  </ItemGroup>
  <ItemGroup>
    <None Include="App.config" />
  </ItemGroup>
  <Import Project="$(MSBuildToolsPath)\Microsoft.CSharp.targets" />
  <!-- To modify your build process, add your task inside one of the targets below and uncomment it. 
       Other similar extension points exist, see Microsoft.Common.targets.
  <Target Name="BeforeBuild">
  </Target>
  <Target Name="AfterBuild">
  </Target>
  -->
</Project>