If Windows Live Writer gave this message when trying to update the theme from your WordPress blog, and if you are using a static page, then maybe I can help.
When you click Update theme on the Blog Account tab in 
Writer, it downloads a number of support files from WordPress. It may write a temporary post to your blog in this process (it will ask for permission). When the blog uses a static landing page it may have trouble doing all this and can’t complete the setup.
Here is the work-around procedure
Click Dashboard in the Blog Account tab to open your WordPress blog dashboard.
This launches your browser and logs in to your WordPress dashboard (you may have to log in).
Expand the Settings tab in the pane at the left and click Reading.
Carefully note (and jot down) the selections for your Front page and Post page settings.
Next click Your latest posts for the setting of what the Front page displays to (temporarily) disable the static page mode. The static page settings should now be grayed out.
Click Save changes – you may have to scroll down.
Back in Writer click Update theme in the Blog Account tab. The update process should now run.
If it asks for permission to do a temporary post click on Yes otherwise it will not install your theme for display in Writer.
The process should finish in a minute or two. The color, background, and fonts of your new theme will show up in the Writer main window.
Back in the browser in your WordPress dashboard in the Reading Settings page, click on A static page to re-enable your static page.
If the settings have reverted to the defaults (in case you closed and reopened your browser) reset the selections for front page and post page (that is why I asked you to jot down the settings).
Click Save changes.
You should now be back in business, your blog will again present your static page as the landing for visitors and you will have full wysiwyg (what you see is what you get) editing capability in Windows Live Writer.
Please leave me a note if you tried this and tell me of any difficulties.
Ask Ludwig 
Pingback: Windows dll error – nvmctray.dll error message in Windows XP? | Top Registry Cleaner Review
Hey, that’s a good idea. I believe the issue can be a culimation between the page generation and the issues that Internet Explorer introduce as the HTML engine for Windows Live Writer.
I hope you have a nice day!
Until next time,
Larry Henry Jr.
Thank you for solving this frustrating problem for me.
Also, make sure your WordPress blog doesn’t have a “Private” setting before you try the method above. Change it temporarily, download the theme, then change it back if you want to.
Thank you gmdavis63,
I had not checked for that problem.
Thank you! That was the only cause of problem I had with downloading the blog theme.
My goodness, after trying umpteen times to fix the issue, all I had to do was change the setting from “Private” to “Public”. Thanks very much gmdavis63 and LudwigKeck.
Excellent fix. Worked like a charm for me. Thanks a lot!!!
Pingback: A collection of posts « Live Writer Basics
Thank you for posting this fix! Worked like a charm!
thank you!
it worked!
Pingback: blog theme couldn’t be downloaded"? « Cầu đất Xanh
Dear Ludwicgkeck,
My infinte thanks to you. It miraculously solves the stubborn issue, for which tried back and forth “a thousand times” in vain..
I also to have a private post setting, but it cause no problem (versus gmdavis63) .. but I had not checked for it categorically.
but again merci, gracias, danke !!
Hope to see you often!
I had similar problem but it was not caused by the Reading settings. The temporary post that Live Writer sends was not visible by default (presumably due to the translation plug-in I’m using). I had to simply enter the temporary post, click update and off Live Writer went with getting the theme. Hope it helps somebody.
Thanks a ton, this worked perfectly! I couldn’t for the life of me figure out how to fix this before reading your post.
Thanks!!!
hello,
in the case where this does not solve the problem see also if you have a cache plugin then set it to off the time you refresh the theme in windows live and set it back to on after
sorry for my poor english
bye
Tim
Thank you! Just tried it and it worked!
Pingback: Fixing the "Blog Theme Couldn't Be Downloaded" Error with Windows Live Writer and WordPress - Max Foundry
Excellent! That solved my issue. Thanks for the well written article.
I am looking for solutions that do not involve a static page setting, since my blog has always been set to “Your latest post” yet I keep getting this error. All the solutions I am finding involve changing the blog to “Your latest post,” which is not helpful.
Windows live writer error showing like the screenshot – http://i.imgur.com/p33pqef.jpg
You entered a “post by email” address, that is not the way to use Live Writer. When setting the account enter the URL of your blog, the address that readers use to reach the blog, like “myblog.wordpress.com”. Live Writer will find the correct “door” with this address and your WordPress username (email address) and password.
Try correcting the account settings (or start over for adding a new account). Good luck!
Hi
I spent all day trying to fix this problem : this method with the static page is the way it worked for me ! Thanks
Thank you, Claire, glad to be of help.