It's a good system in theory, and served it's purpose well and has become an integral part in this game. It's marked its spot in the economy, and has become a hobby for many.
However, I personally find, and I know a lot of the people I play with agree, it's come to far and is actually damaging the game as it is. We're now playing in a time where most players are running around with perfect sets of gear, and the best looking sets are evidently the most popular and so often times you see many people running around looking alike.
No doubt it's all up to how each individual likes their own character, but I think a certain atmosphere and personality is created when people are different and unique. I'm not going to say "in tbc...in vanilla" because this was the case pre 4.3 even, at which point you saw people running around with different pieces of gear from different sets. Even though it didn't always look good, people got used to it and it wasn't bad. This also made you appreciate every single cool piece of gear, and when you pick it up, it makes a difference.
To all the people who want to mention that I am wearing challenge mode gear, I think obtaining a useful fuel set of something should be a feat, something you achieved. Whether it's LFR or mythic, or challenge mode in my case. But the fact that it is strictly transmog gear, which I always have to transmog on the new gear I receive, it makes me like this cool set a lot less.
TLDR: In my opinion the game has more longevity if it's constantly evolving, and how people look changes over time. You also avoid inflation of over used sets, and a lot more variety. In my case, the way I can look the most unique is to avoid transmog entirely.