Barry Allen SCREAMS while playing WotLK

Basically, it gives every player the illusion of change, and while there's still room for bigger scale world events/change, I don't think it's practical to assume every single quest you do has a huge influence on the game unless you want to lock people out who started playing late or missed a quest or zone, so I don't see the problem here, the "world building" is still there, and I'd actually argue this feature does help with creating a world for the individual player. WoW just isn't the game where after 100 people turned in quest X an area will change according to this quest, never to be the same again. Frankly, I don't see another way.

Within these boundaries I do see this as an attempt to actually allow people to feel like what they do means something, though. Up to now, you do a questline to get rid of a demonic presence, and when you're done the quest NPCs thank you, but the moment you go back everything is the same, all the named NPCs and evil machinery and demon mobs are still there. Now they can "hide" certain NPCs for the player or litter an area with NPC corpses which will add do the feeling of "hey, I did this" instead of making all these tasks seem useless.

Just think about it, something like the Deathknight starting experience would never work as well without this feature - right now an "assault" on a town is, maybe, spawning some mobs for a quest. Or it's straight-up slaughtering of X mobs. When the quest is over the town goes back to "normal". Doing a multi-stage assault like in the Deathknight newbie zone would feel pointless that way, but now the two towns are riddled with enemy NPCs for the player who just started, for the player who's halfway through the questline the first town is razed and friendly NPCs patrol the countryside, and for the person who's approaching the end, both towns are burning, littered with corpses and friendly NPCs battling survivors. At least to me this felt much better than the old way of doing things.

Also, I share your opinion on many things but here I think you should lay off the conspiracy theory crack - although I don't assume to know how easy it is, I guess it's very much possible they could have added this earlier. But then they could also have brought warlocks in the endgame down a notch or they could have overhauled the feral druid trees already, but they chose to wait with big changes to established mechanics for the expansion, I don't see anything wrong there either.

This mechanic was present in Skettis. When you used a particular item ("Time-Lost Scroll"?), a bunch of new aggressive bird-men showed up all over the place that no one could see but you. The effect wore off after a while, but I guess Blizzard is just making it permanent now.