Yes its possible to quickly convert a WPF application to Silverlight, for example:-
<TextBlock Text="Hello, World" />
will convert with hardly any changes. Does that help? Clearly not. It really does depend on how much stuff from WPF your app uses that isn't in Silverlight.
You should read through the WPF Compatibility section of the Silverlight documentation to assess how much of your WPF application will port to Silverlight.
What are the limitations of a Silverlight app? Well it can't make a decent cup of tea I know that. Seriously thats far too broad a question. Define what sort of things the app does and that'll guide the advice you get.
For example, is it a LOB app? Does need access to the local file system? Does it depend on third-party components? etc.