I just saw this on Wired and all I can say is "Yay!" I know procedurally-generated stuff gets a bad rap but I always loved it in Arena and Daggerfall. It gives the whole game more of a feeling of expansiveness. It'll be interesting to see how it's implemented. In Daggerfall there was a certain repetitiveness to be sure: "Go to ____ and kill the ______ that has been inhabiting ______'s house." I foresee mods that will expand the developer-made templates, maybe add random quirks and twists - the great thing is the tools are now there in the game to make this possible.