I think that one of Derek's interviews (with Gamespot) gives a decent summary of what FE is about:
DP: Yes and no; the point of the game is still to conquer and rule, of course. But the main difference in Fallen Enchantress, in terms of gameplay style and overall functionality, is that the land must first be conquered and then you can start building before you make choices to defend and/or expand.
He also lists the the main focus areas as tactical combat, the game world, and the magic system, while simplifying city management and removing things like dynasties. These are the things that have been focused on in most diaries and interviews. We can also expect changes / improvements to research, unit design, and really the entire game. I am expecting, at this point, that FE will be a 'more and better' version of WoM, minus a few systems like dynasties that were never fleshed out / working to begin with.
So...where does that leave WoM? The latest patch is basically just minor tweaks. I still don't have a clear picture of how WoM is meant to be different. I'm sad that FE is removing dynasties and maybe some city detail, but I'm glad that this will likely mean a more focused, complete product.
Here is what I would like to see happen:
1) Immediately stop all WoM work and focus all resources on making FE awesome. FE is not a new game, no matter what anyone says. It is an expansion of Elemental, hopefully a major and game-changing one.
2) Anything that was going to be improved / added to WoM, save it for whatever comes after FE. So, if FE is meant to be first of all a more polished, better product and second of all more story / character / world focused, maybe the next game could expand on FE by adding in dynasties, more city detail, etc.
If this isn't going to happen, I would love to see something from Brad about where he thinks WoM is going compared to FE. The last few diaries have shown a lack of focus on this - Brad's frustration is quite obvious. I love that Brad and others are still working hard on making WoM better, but I hate to think that those efforts might be wasted on a game that will be vastly inferior to FE. I really want to play Elemental, and mod, but I'm very hesitant to spend anymore time on WoM when FE looks like it will be a big improvement.