Code

using System.Collections;
using System.Collections.Specialized;
using System.Windows;

using MindFusion.Diagramming.Wpf;

class BoundDiagram : Diagram
{
	public static DependencyProperty DataItemsProperty = DependencyProperty.Register(
		"DataItems",
		typeof(IList),
		typeof(BoundDiagram),
		new PropertyMetadata(null, OnDataItemsChanged));

	public IList DataItems
	{
		get { return (IList)GetValue(DataItemsProperty); }
		set { SetValue(DataItemsProperty, value); }
	}

	private static void OnDataItemsChanged(DependencyObject d, DependencyPropertyChangedEventArgs e)
	{
		var diagram = (BoundDiagram)d;
		diagram.OnDataItemsChanged(
			(INotifyCollectionChanged)e.OldValue,
			(INotifyCollectionChanged)e.NewValue);
	}

	private void OnDataItemsChanged(
		INotifyCollectionChanged oldItems,
		INotifyCollectionChanged newItems)
	{
		if (oldItems != null)
		{
			oldItems.CollectionChanged -= DataItemsCollectionChanged;
			ClearAll();
		}
		if (newItems != null)
		{
			newItems.CollectionChanged += DataItemsCollectionChanged;
			AddItems(DataItems);
		}
	}

	void DataItemsCollectionChanged(object sender, NotifyCollectionChangedEventArgs e)
	{
		if (e.Action == NotifyCollectionChangedAction.Reset)
			ClearAll();
		else if (e.Action == NotifyCollectionChangedAction.Add)
			AddItems(e.NewItems);
		else if (e.Action == NotifyCollectionChangedAction.Remove)
			RemoveItems(e.OldItems);
	}

	void AddItems(IList items)
	{
		foreach (var item in items)
		{
			var node = Factory.CreateShapeNode(0, 0, 40, 20);
			node.Text = item.ToString();
			node.Tag = item;
		}
		Arrange();
	}

	void RemoveItems(IList items)
	{
		foreach (var item in items)
			Nodes.Remove(FindNode(item));
		Arrange();
	}

	void Arrange()
	{
		double y = 20;
		foreach (DiagramNode node in Nodes)
		{
			node.Move(20, y);
			y += 35;
		}
		// todo: run some layout algorithm if you also create links
	}
}