How will they make the world vary?

Quizzical

Basic principle:  they don't have infinite development resources, and therefore, cannot create infinite hand-crafted content.

They claim that there will be an enormous number of nodes in the game world, the overwhelming majority of which never get developed very far, or perhaps even at all.  As a node develops, it is supposed to transform from a village to a city and what not, and the quests and mobs around can change in response.  My basic question is, how do they do that?

They're not going to create a ton of custom quests and art assets and so forth for every single possible development stage of every node in the game.  If they did that, then the overwhelming majority of content they created would never get accessed by anyone, as the node never got developed very far.

What they could do, and likely will, is to create one of each combination of node type and development stage.  There are 4 of the former (scientific, economic, militaristic, and divine) and six of the latter (expedition, encampment, village, town, city, and metropolis), for 24 combinations in total.  Making 24 "cities", most of which are very small because of their early stages of development, is very doable on finite resources.

But what about players being able to place buildings and such?  Well, that's pretty simple:  there will be some standard, pre-crafted buildings of particular types, and the cities will have holes where players can drop buildings.  Which particular buildings go where could vary from one (for example) economic/city node to the next, but that's about it.

The upshot of this is that every single scientific/encampment node will look almost identical to every other.  Or maybe they'll create two or three possibilities for the early levels of development, but there's going to be a lot of repetition.  There can be some minor variations, but that's about it.  That will create an effect of, you travel across the game world and see a "new" city, and then realize that it's nearly identical to one you've already seen elsewhere.

So what about quests and raids and monsters and so forth?  If you make a quest that is only accessible once a particular node develops to the metropolis level, then it's very unlikely that anyone ever gets to see that quest.  There are some things that are easy to randomize, such as the number of drops you require or mobs you have to kill, which type of mobs to kill, and so forth.  But walls of text explaining what to do are not easy to randomize without making them word salad.

So most likely, a given quest will be available in many places in the game world.  Perhaps most or even all of the places that it could have been available will never be accessible to players because the node never develops far.  Or if the game isn't heavy on questing, replace "quest" by whatever other content there will be for players to do.

And this again will lead to a situation where you do something in one place in the game world, then travel far away, and are asked to do exactly the same thing in a different place.  Some games manage to do this even with ostensibly custom content in different areas; Pirates of the Burning Sea was egregiously bad for it.  But that kind of repetition will happen more than you might expect, as it's a pretty much unavoidable consequence of how they want the world to develop around the node system.

And repetition will happen sooner than you might expect, due to the "birthday problem" phenomenon.  Basically, if you have n pieces of content and do one of them at random, you'll expect to only do around sqrt(n) of them before you run into the same one twice.  Furthermore, you'd expect to have to do about n ln(n) pieces of content in total before you hit all of them.  And that's assuming that they're all equally likely; if not, then you'll hit more repetition sooner.

None of this is to say that the game will be bad.  I don't know exactly what they'll do, but what I've laid out above is consistent with the claims on their web site.  But it's impossible to create infinite, high quality, highly varied content.  Their node system of allowing players to modify the world doesn't change that, though it does attempt to go in a different direction than most games within the space of what is possible.  As with so many other pre-release games, the more excitable fans will probably need to dial back their expectations.

Kyleran

Elven magic will take care of everything, have faith...

Ponzini

You pretty much described the problem with MMOs in general. It always boils down to repetition. That is unavoidable. The real interesting stuff will have to come from player conflict. As an example, if you know a raid will open up if you build up a certain node(because another server did it) but you are already at a max number of metropolis nodes, then a good portion of the server will want to destroy that city to form a new one. This game has the potential for a really great community that keeps it interesting for a long time.