Update: the document class used was report, so here's now the solution with the actual settings:
\documentclass[11pt,a4paper]{report}
\usepackage[english]{babel} % english language
\usepackage[latin1]{inputenc} % accents in source
\usepackage[T1]{fontenc} % accents in DVI
\usepackage{color} % add color to the text
\definecolor{bluekeywords}{rgb}{0.13,0.13,1}
\definecolor{greencomments}{rgb}{0,0.5,0}
\definecolor{redstrings}{rgb}{0.9,0,0}
\usepackage{graphicx} % images in the document
\usepackage{float} % containers
\usepackage{wrapfig} % wrap text around figure
\usepackage{vmargin} % redefine the margins
\setmarginsrb{2.5cm}{1.5cm}{2.5cm}{1cm}{0cm}{0cm}{0cm}{1cm}
\usepackage{listings}
\lstset{
basicstyle=\footnotesize, % code font size
numbers=left, % place of numbers
numberstyle=\normalsize, % numbers font size
numbersep=7pt, % distance between code and its numeration
backgroundcolor=\color{white}, % background color
}
\lstdefinestyle{CSharp}{
language=[Sharp]C,
showspaces=false,
showtabs=false,
breaklines=true,
showstringspaces=false,
breakatwhitespace=true,
escapeinside={(*@}{@*)},
commentstyle=\color{greencomments},
keywordstyle=\color{bluekeywords},
stringstyle=\color{redstrings},
basicstyle=\ttfamily
}
\lstdefinestyle{XMLc}{
language=XML,
showspaces=false,
showtabs=false,
breaklines=true,
showstringspaces=false,
breakatwhitespace=true,
stringstyle=\color{bluekeywords},
keywordstyle=\color{redstrings},
morekeywords={name, connectionString, providerName},
commentstyle=\color{greencomments},
basicstyle=\ttfamily
}
\usepackage{titlepic}
\usepackage{appendix}
\usepackage{makeidx}
\usepackage{lmodern}
\usepackage{kpfonts}
\usepackage[
hyperindex=true, % add links in the index
bookmarks=true, % show bookmarks bar when displaying the document}{hyperref}
]{hyperref}
\hypersetup{
colorlinks=true, % colored links
breaklinks=true, % allows return line in too long links
urlcolor= blue, % links color
linkcolor= blue, % internal links color
citecolor= blue, % green by defaut, color of citation links (bibliography)
bookmarksopen=true,
pdftitle={Cloud 3D Teapot},
pdfauthor={Jos\'{e} L\'{o}pez C\'{i}vico},
pdfsubject={Cloud Latency}
}
\makeatletter
\newcommand\chapassect{%
\def\@chapter[##1]##2{\ifnum \c@secnumdepth >\m@ne
\refstepcounter{chapter}%
\typeout{\@chapapp\space\thechapter.}%
\addcontentsline{toc}{section}%
{\protect\numberline{\thechapter}##1}%
\else
\addcontentsline{toc}{section}{##1}%
\fi
\chaptermark{##1}%
\addtocontents{lof}{\protect\addvspace{10\p@}}%
\addtocontents{lot}{\protect\addvspace{10\p@}}%
\if@twocolumn
\@topnewpage[\@makechapterhead{##2}]%
\else
\@makechapterhead{##2}%
\@afterheading
\fi}%
}
\makeatother
\begin{document}
\tableofcontents
\newpage
\listoffigures
\newpage
\chapter{Test Chapter}
\section{A Regular Section}
\appendix
\clearpage % or \cleardoublepage
\appendixpage
\addappheadtotoc
% code to show appendices at section level in TOC
\chapassect
\begin{appendices}
\chapter{Installation requirements}
\chapter{Acronyms}
\end{appendices}
\end{document}

I moved the hyperref package and loaded it last (except some well documented exceptions this should always be done).
Here's one option; the appendix package was used to include "Appendices" in the ToC just before the appendices, and the titletoc package was used to change the way chapter entries are typeset in the ToC, inside the appendix environment:
\documentclass{book}
\usepackage{appendix}
\usepackage{titletoc}
\begin{document}
\tableofcontents
\chapter{Test Chapter}
\section{A Regular Section}
\begin{appendix}
\addappheadtotoc
\titlecontents{chapter}
[3.8em]
{}{\contentslabel{2.3em}}
{\hspace*{-2.3em}}
{\titlerule*[0.7em]{.}\contentspage}
\chapter{Test Appendix One}
\chapter{Test Appendix Two}
\end{appendix}
\end{document}

In the above solution I assumed that appendices will be build using \chapter, and only the entries in the ToC must be changed; if the intent is to use \section to typeset the appendices, then it's enough to use the subappendices environment from the appendix package, and to redefine \setthesection:
\documentclass{book}
\usepackage{appendix}
\renewcommand\setthesection{\Alph{section}}
\begin{document}
\tableofcontents
\chapter{Test Chapter}
\section{A Regular Section}
\addappheadtotoc
\begin{subappendices}
\section{Test Appendix One}
\section{Test Appendix Two}
\end{subappendices}
\end{document}

Since, according to a comment, the hyperref package is being used, the titletoc solution won't be completely valid, since these two packages don't interact well; in this case, some extra work has to be done:
\documentclass{book}
\usepackage{appendix}
\usepackage[colorlinks=true,linkcolor=blue]{hyperref}
\makeatletter
\newcommand\chapassect{%
\def\@chapter[##1]##2{\ifnum \c@secnumdepth >\m@ne
\if@mainmatter
\refstepcounter{chapter}%
\typeout{\@chapapp\space\thechapter.}%
\addcontentsline{toc}{section}%
{\protect\numberline{\thechapter}##1}%
\else
\addcontentsline{toc}{section}{##1}%
\fi
\else
\addcontentsline{toc}{section}{##1}%
\fi
\chaptermark{##1}%
\addtocontents{lof}{\protect\addvspace{10\p@}}%
\addtocontents{lot}{\protect\addvspace{10\p@}}%
\if@twocolumn
\@topnewpage[\@makechapterhead{##2}]%
\else
\@makechapterhead{##2}%
\@afterheading
\fi}%
}
\makeatother
\begin{document}
\tableofcontents
\chapter{Test Chapter}
\section{A Regular Section}
\begin{appendix}
\addappheadtotoc
\chapassect
\chapter{Test Appendix One}
\chapter{Test Appendix Two}
\end{appendix}
\end{document}

The code above assumed the book document class; after a comment, it seems that this class is not used, but unfortunately the actual document class is not mentioned in the comment; however, given the error message obtained by the OP after trying to implement my last suggestion, my crystal ball tells me that the document class might be amsbook. In this case the necessary redefinition is even simpler:
\documentclass{amsbook}
\usepackage{appendix}
\usepackage[colorlinks=true,linkcolor=blue]{hyperref}
\makeatletter
\def\@chapter[#1]#2{\refstepcounter{chapter}%
\ifnum\c@secnumdepth<\z@ \let\@secnumber\@empty
\else \let\@secnumber\thechapter \fi
\typeout{\chaptername\space\@secnumber}%
\def\@toclevel{0}%
\ifx\chaptername\appendixname \@tocwriteb\tocappendix{section}{#2}%
\else \@tocwriteb\tocchapter{chapter}{#2}\fi
\chaptermark{#1}%
\addtocontents{lof}{\protect\addvspace{10\p@}}%
\addtocontents{lot}{\protect\addvspace{10\p@}}%
\@makechapterhead{#2}\@afterheading}%
\makeatother
\begin{document}
\tableofcontents
\chapter{Test Chapter}
\section{A Regular Section}
\begin{appendix}
\addappheadtotoc
\chapter{Test Appendix One}
\chapter{Test Appendix Two}
\end{appendix}
\end{document}

titletocandhyperrefdon't play well together; please see my updated answer for a new solution compatible with the use ofhyperref. – Gonzalo Medina Mar 21 '13 at 21:58@is a special character for internal macros; redefining such macros (containing the character) in a.texfile requires\makeatletter,\makeatotherto perform a change in category codes. a detailed explanation can be found in the answer to http://tex.stackexchange.com/q/8351/3954. – Gonzalo Medina Mar 21 '13 at 23:39amsbook. If this is not so, please add to your question the simple complete document I asked for in my previous comment. – Gonzalo Medina Mar 22 '13 at 18:16