Figuring out what is going on can be a challenge. Fortunately they added a number of trace switches to allow you to track what the components are doing. Add the following to the app.config file to see what is going on:

<system.diagnostics>
  <switches>
    <add name="System.Workflow LogToTraceListeners" value="1" />
 
    <add name="System.Workflow.Runtime.Hosting"     value="Verbose" />
    <add name="System.Workflow.Runtime"             value="Verbose" />
    <add name="System.Workflow.Runtime.Tracking"    value="Verbose" />
    <add name="System.Workflow.Activities"          value="Verbose" />
    <add name="System.Workflow.Activities.Rules"    value="Verbose" />
  </switches>
</system.diagnostics>

Valid value are:

If you are tracing a workflow hosted in IIS you need to make sure that the IIS worker process has the necessary rights to create and write to the log file specified.