In MVVM should the ViewModel or Model implement INotifyPropertyChanged?

I strongly disagree with the concept that the Model should not implement the INotifyPropertyChanged. This interface is not UI specific! It simply informs of a change. Indeed, WPF heavily uses this to identify changes, but that doesn't mean it is an UI interface. I would compare it to the following comment: "A tire is a car accessory". Sure it is, but bikes, buses, etc. also use it. In summary, do not take that interface as an UI thing.

Having said that, it doesn't necessarily mean I believe that the Model should be providing notifications. In fact, as a rule of thumb, the model should not implement this interface, unless it is necessary. In most cases where no server data is pushed to the client app, the model can be stale. But if listening to financial market data, then I do not see why the model cannot implement the interface. As an example, what if I have non-UI logic such as a service that when it receives a Bid or Ask price for a given value it issues an alert (ex. through an email) or places an order? This could be a possible clean solution.

However, there are different ways of achieving things, but I would always argue in favor of simplicity and avoid redundancy.

What is better? Defining events on a collection or property changes on the view model and propagating it to the model or having the view intrinsically update the model (through the view model)?

The bottom line whenever you see someone claiming that "you can't do this or that" it is a sign they do not know what they are talking about.

It really depends on your case and in fact MVVM is a framework with lots of issues and I am yet to see a common implementation of MVVM across the board.

I wish I had more time to explain the many flavors of MVVM and some solutions to common problems - mostly provided by other developers, but I guess I will have to do it another time.

In M-V-VM the ViewModel always (Model not always) implements INotifyPropertyChanged

Check out the M-V-VM Project Template/Toolkit from http://blogs.msdn.com/llobo/archive/2009/05/01/download-m-v-vm-project-template-toolkit.aspx. It uses the DelegateCommand for commanding and it should be a great starting template for you M-V-VM projects.

I'd say quite the opposite, I always put my INotifyPropertyChanged on my ViewModel - you really don't want to be polluting your model with a fairly WPF specific feature like INotifyPropertyChanged, that stuff should sit in the ViewModel.

I'm sure others would disagree, but that's the way I work.