There seems to be a bug with newer versions of Skype that Skype does not 
remember the setting to 'do not ask me again'  The only workaround is to 
install an older version of Skype, then save the setting.  I actually recommend 
installing older versions of Skype anyway (I'm running Skype 3.0) since they 
use less memory.

The plugin does only handle just IM/Chat's, it still uses Skype for calls.

Thanks for the version suggestion...I'll look into that.

Handling of calls: I still get the Call dialog popping up; how can I get it to 
stop opening?

-Scott

Version use: Ver 3 of Skype is not compatible with my OS (Win7 x64), and 
although ver 4 is, the Silent message still reappears each time.

I could live with that, though how can I stop skype4pidgin from intercepting 
skype calls and not open a message window or open the call dialog 
(Reject/Answer dialog box)?

When Skype is in silent mode, it doesn't show any call notification info, which 
is why the plugin shows the call notification in Pidgin (else you wouldn't see 
it at all).

That's weird that it's still not letting you save the silent mode notice. Can 
you have a look in
%appdata%\Skype\{Your skype username}\config.xml
And see if there's a setting for <SilentModeOn> for Pidgin
If there's not, you can try adding one in for
<C.3A.5CProgram.20Files.20.28x86.29.5CPidgin.5Cpidgin.2Eexe>1</C.3A.5CProgram.20
Files.20.28x86.29.5CPidgin.5Cpidgin.2Eexe>

skype4pidgin Call notification: the problem, for me, with using that function 
is first, rather than simply declining the call and sending the call to voice 
mail, the Reject button ends the call, with a busy tone on the other end. 
Second, the process opens another window which must be manually closed at the 
end of the call, and that window doesn't have access to the number keypad, etc. 
If I elect to not enable silent mode, skype4pidgin still opens the skype4pidgin 
call notification dialog, which must be manually closed at the end of the call. 
Basically, I still want to use Skype for calls and use Pidgin to only handle 
IM's. It's possible that the SilentMode issue is affecting how I want to use it.

I added the above code to the XML, though not certain if I need to add it 
as-is, and I just placed it after the opening <config...> statement. I still 
need to slect the SilentMode option upon startup.

Related thread to the Silent Mode issues: 
http://forum.skype.com/index.php?showtopic=797141

Supposedly it's a Feature, not a Bug.  The "Do Not Ask Again" box is 
non-functional...  Which I think is a load of baloney, but there's a reason I 
am trying to use Skype via Pidgin instead of via Skype.  Skype drives me batty 
for many other reasons.

The 'SilentModeOn' XML needs to be added after </ShowSendContactsMessages>

I'm going to try this workaround:
http://forum.skype.com/index.php?showtopic=792587&view=findpost&p=3394089

install old version (4.2), let it set <SilentModeOn> for Pidgin, upgrade to 
latest Skype

[deleted comment]

I had success adding the following XML in the 
%appdata%\Skype\{Your skype username}\config.xml
file (after </ShowSendContactsMessages>):


    <SilentModeOn>
      <C.3A.5CProgram.20Files.20.28x86.29.5CPidgin.5Cpidgin.2Eexe>1</C.3A.5CProgram.20Files.20.28x86.29.5CPidgin.5Cpidgin.2Eexe>
    </SilentModeOn>

What is the hierarchy for the SilentModeOn element? I don't have a 
ShowSendContactsMessages element in my config. What is the common parent 
element of SilentModeOn and ShowSendContactMessages?

Parent element is "<UI>"

Dropping it right under <UI> worked.  When it re-saved itself it just reordered 
it to where it wanted it--near the end right above <Sounds>.

Thank you!  No more annoying popups!

Unfortunately, inserting a <SilentModeOn> element as suggested in comment #10 
didn't work for me. Skype happily reordered the config.xml but I still get the 
annoying messages.

@rvdbo...@gmail.com, did you edit the xml file when Skype wan't running?

instructions are as follow
1) stop skype application
2) in config.xml under <UI> add

<SilentModeOn>
      <C.3A.5CProgram.20Files.5CPidgin.5Cpidgin.2Eexe>1</C.3A.5CProgram.20Files.5CPidgin.5Cpidgin.2Eexe>
    </SilentModeOn>


3) run skype

Maybe I tried it when Skype was still running - I don't exactly remember. I 
have a new laptop now with Windows 7 64 bit on it. I tried it again and managed 
to turn off the annoying popups by inserting

    <SilentModeOn>
      <C.3A.5CProgram.20Files.20.28x86.29.5CPidgin.5Cpidgin.2Eexe>1</C.3A.5CProgram.20Files.20.28x86.29.5CPidgin.5Cpidgin.2Eexe>
    </SilentModeOn>

(note the slightly different tag name) into config.xml, which I found at this 
location:
%appdata%\Roaming\Skype\[skype user name]\

This is not working for me on Skype 5.5.0.124 on Windows XP Prof SP3 (German 
version) with:

    <SilentModeOn>
      <C.3A.5CProgramme.20.28x86.29.5CPidgin.5Cpidgin.2Eexe>1</C.3A.5CProgramme.20.28x86.29.5CPidgin.5Cpidgin.2Eexe>
    </SilentModeOn>

Somewhere in the <UI> Tag.
I use a AutoHotkey Script which closes the Skype Nagscreen immediately each 
time it opens (attached).
But this is a dirty solution. Dirty like Skype itself ;)

[deleted comment]

Sorry, I made a mistake. The tag (put just before </UI>) should be:

    <SilentModeOn>
      <C.3A.5CProgramme.5CPidgin.5Cpidgin.2Eexe>1</C.3A.5CProgramme.5CPidgin.5Cpidgin.2Eexe>
    </SilentModeOn>

I didn't understand the hex-values (.3A=: .5C=\ .20=space .28=( .29=) .2E=. - I 
was irritated by the . as hex-mask-sign) and forgot to discard the (x86) in the 
path name (which is for a 64 bit system).

With this tag it is working, finally :)

The current version of the Skype client, 5.10, has fixed the underlying 
issue("do not ask me again" now works). Upgrading your Skype client and 
restarting Pidgin produces the expected behavior - no dialog is presented 
prompting for permission.