About the de-emphasis of magic items... to me, this has one potentially negative effect, and one potentially positive effect. The negative outweighs the positive, though.
NEGATIVE EFFECT:
In previous editions, magic items always functioned as a sort of "parallel improvement track" to XP. By parcelling out the treasure and magic items, the DM could essentially steer the rate of advancement and also set the tone of the campaign to an extent. The difference between high-magic and low-magic, between Monty Haul and sparse and difficult. I think it's good to allow this option to be in the hands of the individual campaign. Furthermore, when you're playing a character, you always know approximately how long it'll take you to get to the next level... but you MIGHT find some really awesome magic item in your next encounter, so that's always something to look forward to.
Furthermore, highly powerful magic items allow players to make character builds which step out of the boundaries of "class" a little. (Apart from D&D, I've always preferred more skills-and-powers-based games as opposed to class-based games.) A fighter-type with Boots of Flying is suddenly stepping in the territory of the spellcasters, and I think that's perfectly okay. A mage with a powerful magic sword is suddenly just a little bit more able to compete on the level of the martial classes. (And to digress, I wonder... if every mage has some sort of automatic per-round mage strike-type attack, will that sadly mean the end of cross-class "utility mages" who use their magic primarily to boost their melee or rogue abilities?) And then there's the various skill-duplicating items like the Cloaks of Elvenkind and so on. I think that allowing more variety in character design is always good, and that means including various ways to make hybrid characters, using things such as magic items to fill in the gaps in one's strength. The core characters should be simple enough that you can expand them off in a million zillion directions and fighting styles, and one of the ways to support this is with a different selection of magic items. A fighter who wants to become roguelike by using Silent Shadowy Armor +1 *should* be able to do that.
So I hope they don't narrow the functions of magic items too much. The whole *point* of magic items is to give you an unexpected boost, an unexpected power, to broaden and expand your character. And unlike character class and race traits, it's up to the DM whether to include specific magic items in the campaign, so issues of "balance" are ultimately in the DM's hands and can be customized by each DM (particularly if the system doesn't allow magic item creation).
POSITIVE EFFECT:
The positive effect of reducing the strength and importance of magic items, IMHO, is that it'll make it more socially acceptable for the DM to run adventures where the PCs lose all their stuff. The old "attacked by the rust monster", "taken prisoner", "pickpocketed" kind of adventures. If items aren't as much of a core character trait -- if your Iron Heroes-style berserker can break out of his chains and grab a rock off the floor and wield almost as much damage as he did with his battleaxe, while he's breaking out of jail -- then it allows some new adventure hooks. (Well, fun for me as the DM, anyway... so maybe this is a bit tasteless to list as a positive effect.) :/ In a way it's interesting because it will create a more "low magic" effect (perhaps) and makes characters less dependent on fancy stuff. But in another way it's bothersome because it reduces one of the core motivations/methods of character improvement.
(And of course, lest anyone say I'm forgetting it... of course there is always role-playing and in-character goals and other reasons to keep playing, apart from getting buffer and buffer. But for now, let's just talk about the "making your character more bad-ass" element. I hear that MMORPG designers have difficulty getting players excited about In-Game Titles ("Your character is now the Duke of Blah!") and fortress-building (like in poor old Ultima Online) and other things which don't translate to simple, raw increases in badass-ishness. So if D&D4E emphasizes either of these things -- although I haven't seen much evidence that they will apart from speculations on this thread -- perhaps they will actually be bucking the MMORPG play style.)
Of course, in the end it's probably moot because I'm sure that Wizards will release more and more magic items in future supplements until there's as much stuff out there as there was in 3rd edition. Well, maybe.