After solving the problem myself I decided to post some replay that may help others in the future.
The problem is a known issue with the Visual Studio 2010 Express SP1 which removes the additional 64 bit compilers. One of these compilers (amd64) is used by Scilab to compile the interface functions. To re-install the missing compilers a fix is supplied by Microsoft, get it from:
http://support.microsoft.com/kb/2519277 .
After installing the above fix, Scilab 5.3.3 detects the 64 bit compilers but compilation reports errors. The bad news is that I did not find an easy way to make Scilab 5.3.3 to compile the interface.
There must be a problem with the makefile or something because the new Scilab 5.4.0 alpha edition, available now, compiles the functions without a problem. My solution was to compile the functions using Scilab 5.4.0a1 and use it with Scilab 5.3.3.
Scilab 5.4.0a1 has some issue with setting stacksize to "max" so I could not use it (but that's an issue for a different post :-))).
Hope this helps someone.
Regards,
Moti