I happen to be in favor of keeping the restrictions.
Suppose, hypothetically, that you have a core class that doesn't let you "come back" after multi-classing.
Suppose (again, hypothetically), that the abilities that class gains at higher levels are more powerful than the abilities other classes - without multiclassing restrictions - gain at higher levels.
Is it fair to balance "better abilities" by putting on the restriction "no multiclassing?" I happen to think so.
Now, let's look at the monk and paladin - I think it's clear that monks gain a ton of nifty abilities as they progress in level - and that (to me) the attraction of a monk at high level is that you're not nearly as dependent upon your items as other classes - your abilities are inherent, rather than dependent upon bonuses from external items. A naked monk can kick the trash out of a naked fighter at similar levels. That means you have abilities that NO MATTER what, the DM can't take away - not with a well-placed Sunder on your blade, not with a silence spell (bards) or by stealing your spell components bag (wiz/sor) or taking your holy focus (cleric/druid) or by denying you flanking bonuses (rogues) or by not using your favored enemy (ranger) or by any other of a host of things. Truly, monks' abilities are by far the LEAST DM-dependent of abilities - which makes them the MOST desirable. Hence, they are, in a sense, the most powerful - because the DM has no way of eliminating them or taking them "out of play" (short of house-ruling them out of the game, of course).
Now, look at the paladin as written. The paladin gets benefits at higher levels that I would consider more powerful than those of other classes - his mount is more powerful than a wizard or sorcerer's familiar. He gets turning ability at third level... don't discount that. His spellcasting, while not monstrously wonkishly impressive, is another nice little boost. For all of these reasons, again, I think the paladin's abilities are a little bit "Better" than a standard class's - and to restrict them to those paladins who dedicate a certain number of consecutive levels to the class helps to balance them out. After all, IMO, the benefits from four levels of paladin (minor spells, a special mount, turning ability, smite ability, immunity to disease, Cha bonus to all saves) are MUCH more desirable than those from four levels of wizard or sorcerer (a lot less hit points, a familiar that is not nearly as powerful as a mount, and minor spells - you're not getting fireballs from 4 wiz or sor levels)... especially when applied to a "fighting class" such as a fighter. To balance that, the restriction that "you must take the 4 levels of paladin in a row" does not seem so heavy-handed. (Paladins' abilities after 4th level are not as impressive, but if I had to pick one class to gain 4 levels' worth of abilities from, paladin would definitely be it).
I welcome those who said, "I don't like it" to offer their response to my opinion - I happen to think it is a valid one, but perhaps I have over/underestimated the relative value of the abilities a monk or paladin gets. How do you maintain game balance in multiclassing when some classes' abillities are much more desirable than others? Is "you can't go back" a bad balancing mechanic? What do you propose instead?
I know WotC has claimed it's a flavor issue - and they may believe that - but to me it is more of a balancing issue than most seem to want to think.
(Yes, I welcome the "un-front-loading" of the ranger).
--The Sigil