So WoW's getting some changes that Rift players already got to experience and then some:
Let's go over some of this slowly.
First, the appearance tab is essentially the idea of making your character look like she's wearing different armor than she actually is. That is, it may look like a low level piece of gear, but it's actually the invincibility cloak of the ages. Why do this? Because in theme park MMOs characters start to all look the same. Character creation options are already fairly limited, and armor can't be dyed, so everyone, quite literally, ends up wearing the same thing once you're at the max level. It's great that there's an option, but Blizzard isn't allowing everything. After all, Blizzard has stated that they don't want WoW, a game known for it's heavy use pop-culture references (Harris Pilton? "Orc Smash"?) and inane lore (still no explanation on PC's inability to die? Space elves?), too allow players to look "too silly." I know, I was confused too. Pick up your jaw and lower your eye brows. Lord knows that Star Wars Galaxy's ability to create fat, ugly characters made it so that everyone made those sorts of characters and ruined the game. Sorry, what was that? Ugly characters were few and far between? A few people actually made slightly chubby characters for realism sake, but overall palyers decided they wanted to be flawless? How odd.
The short story on this is that Blizzard is afraid of their player base. I'm not too surprised given them many people I knew were originally going to dodge WoW based on the sort of person you tend to bump into when playing Star Craft. Still, if players want to dual wield fish, why not let them? After all, female warriors have already tanked in thongs and bikinis. I don't see how much sillier things can get when players are given some options. Besides, it's not like they're going to dye all their armor pink (since, unlike Rift, WoW still won't have dyes).
Next, we may have cross server raiding soon. The amount of instancing in WoW has already made any semblance of an online community rather hard to construct, and this will only further increase the situation. Rather than playing on the same server, people will be able to raid with a guild simply by using RealID it seems. Sure, some of us with friends on another server will be able to raid together, but only if we're of the same faction. It's a nice option, but WoW is feeling like less of a "persistent world" and more like a glorified lobby.
Last, but not least, changes to appearance means that WoW may finally be losing it's silhouetting mechanic. For those unfamiliar with the term, silhouetting is the ability to look at another player and immediately determine certain key features about that character: friend or foe, class type, and strength. This may be good for some games, but I've always hated this in MMO. Perhaps it's because I grew up in sandbox games where there was an element of danger in meeting new people, but the simple fact remains that quickly identifying these things about another player dumbs down the game. Unless you're completely brain dead, you should have some ideas of how the fight will go and what strategies you'll need to use. It's like playing poker with an open hand and yeah, I can see someone enjoying that. However, it takes away some of the thrill of the game, such as bluffing. I know people don't like "random factors" these days since people think e-sports should have regularized systems but we are playing video games, folks. Some people may think that looking a bit different won't change much, but your average player makes a lot of judgements based on appearances (I know, you can look at buffs, but in all honesty, most players aren't that smart still).
Why is this finally happening? Recent gaming trends are finally catching up with Blizzard. Character customization is a big area that WoW's always lagged behind, and with Rift and Bioware's upcoming TOR, Blizzard may be finally buckling down to appease social players. A game can actually service without power players, explorers, and pvpers (look at Horizons/Istaria), but think about what keeps you playing an MMO or going back to one. I think for many of us, it's social reasons. We have friends who, no matter how bad they are, we want to play with. They stick with the games they're attached to. WoW has age and toys on it's side, but it's graphics are dated, and that's something softcore gamers really tend to gravitate too. Better graphics may lure some of your buddies to new games, but... eh. Better mechanics work better, but your main tank's girlfriend doesn't want to give up all her mounts and pets, so he'll be back within a month. If you tell her, "Hey, this game lets you choose body type and you can make pretty outfits and change the color of your clothes," she'll be all over it, and your MT's still with you.
This is what Blizzard's worrying about. It's why Cata starts hard and gets progressively easier each month. They're trying to please as many people as possible. TOR's bringing in easier mechanics, new pvp games (well, new to some folks), and more customization. GW2 promises cross server action and easy ways of changing servers. And Rift's just WoW 2-3 months in the future but with not quite as many raids/pets/mounts.... so far. So what is Blizzard doing? Making it easier to play with your friends, giving you some customization options, and making pvp just a wee-bit more interesting. I don't blame them. It's going to work on a good amount of people. But without a doubt, people need to see it for what it is: World of Warcraft is getting competition and Blizzard finally has to adapt to stay afloat. Thank god.