James Phinney, lead designer on Guild Wars 2 at ArenaNet has written an informative developer diary about the direction they'll be taking on Guild Wars 2.

For the team at ArenaNet, the idea of making Guild Wars 2 started with a single conversation about all the things we wanted to do in the next Guild Wars campaign. Very quickly it became clear that we could move the game forward by leaps and bounds... but only if we were willing to rebuild it from the ground up. Here's what we thought we could accomplish:

• Give players immense freedom of movement. The underlying systems in Guild Wars allowed us to make a very responsive, yet hack-proof game, but they also prevented us from giving players the ability to jump and swim and explore their environment freely. We’ll still keep movement hack-proof, but we want players in Guild Wars 2 to simply enjoy moving around.
• Allow players to encounter each other in common, persistent areas. The instancing of Guild Wars gave us a ton of story-telling and gameplay advantages over our competitors, but instanced areas and persistent areas each have their strengths and weaknesses. We want to give players the best of both worlds.
• Let players choose from multiple playable races (including our own unique addition to the fantasy genre, the Charr). Our team takes a lot of pride in the look and feel of each of the professions in the game, but some of the early technical choices we made for them prevented us from even considering introducing playable races. Now we have a chance to make new choices that give players more options.

Read more here.