If I recall correctly ghosts were banned, not the ability to become ethereal specifically. I had already submitted my character build, without getting a thumbs down, at the time you got the no on ghosts. So my guess is that the difference is that ghosts can't become physical whereas Fiends of Possession have to either inhabit an object or use an action once every several rounds in order to avoid returning to normal material form. If allowing a FoP was an oversight, I suppose I could start building a new character, but I'd probably hold off and wait to see whether or not the campaign is going to stay around for a while.I have to note that ethereal characters were specifically banned and Voidrazor is running a character who can become ethereal at will. Sorry to be a stickler, but it doesn't seem fair that an option is open to one player and not to others - especially since I had been planning to use it.
Sorry Voidrazor, don't mean to be irritating, but fair is fair sort of thing.
Incorporeals...I'm going to have to say no to to the ghost.