This is speculation supported by the "dungeons" video that's been released to promote Eye of the North. If you look above heat sources such as torches in the video, you can see heat ripple. This is a realtime refraction effect, which is not (to my knowledge) an effect supported by the current GW engine or it would have been used in Nightfall along with the rippling portals. So it looks like we'll be getting at least a minor graphics engine upgrade along with EofN. That's nice.
Those per pixel shaders (simulated refraction from different air density) are currently in the login screen. Maybe i'm missing something here, but aren't the same pixel displacement shaders used in water ripples and portals (Elona) by using some tilable image map or procedural function?
I wouldn't mind an upgrade, but the engine is one of the best ones I've come across so far. The loading times never seize to amaze me, and the streaming updates are totally awesome.
The heat ripple only goes so far, though, at least for my graphics card. The heat ripple will go through what's blocking it, like when my warrior's leg blocked the torch, his leg began to ripple.