Personally? it phases me out of interacting with most of my server, the only pvp i have seen was some alliance players camping the new teleport to undercity to catch people porting in and having to take a lowbie from somewhere like the ghostlands to org just to turn it on or off is a bit tedious.
My initial reaction is the sw/org option should change to any capital city and flagging pvp should not phase you out, it never did before you just went from blue name to green. Now you can't see someone being attacked and join in unless you are already in warmode which means phasing yourself out away from most of the playerbase.
It just seems right now aside from portal camping gank squads the 10% bonus isn't really worth it since you are removed from the world of the mmo for the most part which seems counter to the point of world pvp.