Before the Mango update, Windows Phone developers were advised against using the application bar with a Panorama control. This was somewhat changed with the Mango which includes a new minimized mode for the application bar. This mode can be accessed using the Mode-property of the application bar.
For example the built-in People hub uses this new mode. But if you cycle through the panorama items in the People hub, you’ll notice that there’s one panorama item where the application bar is shown in its default mode. This is a nice behavior because it draws the user’s attention to the functionalities provided by the application bar. And this same behavior has been replicated by many 3rd part applications. But be careful with it, because in its current state, changing between the two different modes may cut some pixels from your panorama’s background.
Mikael Koskinen has written a short piece on how to overcome this problem and ensure a continuous user experience.