The document will be imported with a loss of content. The reason is that ASCII85Decoder will throw an ArgumentException when the stream doesn't end with '~>'. 

Although this is invalid case according to PDF specification, other applications are handling it and the document is successfully visualized in them. We may also consider implementing workaround that handles such invalid streams.

According to the PDF specification (Adobe® Portable Document Format Version 1.7):
Append a rectangle to the current path as a complete subpath, with lower-left corner (x, y) and dimensions width and height in user space.

The operation: 

x y width height re

An invalid case:

0 - 595 -842 re

This leads to an exception thrown: System.NullReferenceException: 'Object reference not set to an instance of an object.'

A password is asked although Adobe opens the document without one when the document is encrypted with "Encryption of data using the RC4 or AES algorithms with a file encryption key length of 40 bits." - Version 1 (V 1) Revision 2 (R 2).

Similar cases (V1 R3 and V2 R3) are handled in the following item: PdfViewer: A password is asked although Adobe opens the document without one.

The PDF document with images shows black canvas:

NOTE:

Introduce events similar to the PageRenderStarted and PageRenderCompleted ones that the Telerik UI for WinForms RadPdfViewer provides:

WinForms PdfViewer How-To Handle Rendering Events - Telerik UI for WinForms

This is not quite a valid PDF file scenario according to PDF file specification. However, we may try handling it in order to show the correct number of pages. When the kid is of type Pages, it should be added to the pages traversal recursion only the first time it is met.

When importing a document containing a single associated widget annotation merged into the field dictionary the field is skipped on import and an exception is thrown.

According to the PDF Specification: Field Dictionaries: Kids:

An array of indirect references to the immediate children of this field.
In a non-terminal field, the Kids array is required to refer to field dictionaries that are immediate descendants of this field. In a terminal field, the Kids array ordinarily must refer to one or more separate widget annotations that are associated with this field. However, if there is only one associated widget annotation, and its contents have been merged into the field dictionary, Kids must be omitted.

A memory leak in RadPdfViewer when the control gets removed from the visual tree.

To work this around, use the reflection API to access the leaking VisualTarget objects and call their Dispose method manually.

var pdfViewer = hostBorder.Child as RadPdfViewer;

if (pdfViewer != null)
{
    var canvas = viewer.ChildrenOfType<Canvas>().FirstOrDefault(x => x.GetType().Name.Contains("ContentElementsCanvas"));                
    var visualTargetsDictionaryField = canvas.GetType().GetField("pageNumberToVisualTarget", BindingFlags.NonPublic | BindingFlags.Instance);
    var visualTargetsDictionary = (Dictionary<int, List<VisualTarget>>)visualTargetsDictionaryField.GetValue(canvas);
    foreach (KeyValuePair<int, List<VisualTarget>> target in visualTargetsDictionary)
    {
        for (int i = 0; i < target.Value.Count; i++)
        {
            VisualTarget item = target.Value[i];
            item.RootVisual = null;
            item.Dispose();
        }
    }  
}
hostBorder.Child = null;
hostBorder.Child = new RadPdfViewer() { Document = newDocument };

The issue is reproducible only on Windows XP. On newer versions of windows, the images are rendered as expected.

WORKAROUND: You may inherit DctDecode class in order to implement custom decoder. For instance, you may try calling DecodeWithJpegDecoder method from the base class as mentioned in the note of this documentation article:

http://docs.telerik.com/devtools/wpf/controls/radpdfviewer/customization-and-extensibility/customize-pdf-rendering

A sample implementation of these custom decoder may be seen below:

public class CustomDctDecode : DctDecode
{
    public override byte[] Decode(PdfObject decodedObject, byte[] inputData, DecodeParameters parms)
    {
        return DecodeWithJpegDecoder(inputData);
    }
}

Currently, the PdfProcessing document model is providing support only for a single function in the Function entry.

According to the PDF Specification: Function: A 1-in, n-out function or an array of n 1-in, 1-out functions.