If anything has gone wrong the first thing to do is go through all the steps in our extended upgrade instructions. That page also has information about some of the most common problems we see.
Upgrading WordPress « WordPress Codex
I recently upgraded WordPress manually following the instructions at Upgrading WordPress « WordPress Codex. Soon after, when I tried to post using Windows Live Writer, I received the xmlrpc.php invalid response error. This does not happen if I upgrade using Fantastico.
WordPress support forum led me to think that the problem was with my blog client, Windows Live Writer.
It seems I am not alone, Joe Cheng at Microsoft received a lot of complaints about Live Writer not working after upgrading WordPress.
Actually, the problem is not with Windows Live Writer, it’s with the WordPress upgrade instructions.
Briefly, Upgrading WordPress « WordPress Codex says:
copy contents of downloaded zip file to:
1. wp-admin directory
2. wp-includes directory
3. wp-contents directory
But it neglects to tell you to also overwrite the contents of the root directory with the files from the zip file.
This screen capture shows some of the files at the root directory.
As it turned out, one of the files in the root is xmlrpc.php.
After I overwrote the root files, Windows Live Writer posts fine to my blog.