Why they did it (maybe)
What I like about it
First, I love the way they will implement this. What they really did was open up the Reason API's for developers so that they can make Reason instruments and devices that are first class members of the Reason rack. You get true Reason instruments that work and behave just like anything else in the rack.
Second, I like that fact that instead of waiting with baited breath for the next release for the new devices (and then inevitably complaining about what they didn't do) we will have access to new devices all the time. Third, there are instruments that the Propellerheads would never have thought of, or if they did would never have created just because the audience wasn't there to justify the development cost. This is a question of priorities. We will see more and more varied types of devices.
The rack extension solves a problem that has always bugged me about the Combinator. The Combinator UI is flexible with 4 knobs and 4 on/off switches, but it is also somewhat limiting. The advantage of Rack Extensions is that the UI can be completely customized to the type of device you are creating. Look at the Alligator processor in Reason 6, for example. There are like 30 knobs on the Alligator. You couldn't implement that as a Combinator, but you sure can as a Rack Extension.
Why it makes me a little sad
What we can expect
We may see a lot of what used to be ReFills, implemented as Rack Extensions. For example, we will probably see a guitar or string Rack Extension. Maybe in the past these would have been implemented as ReFills, but they might now be Rack Extensions. Is this good or bad? Probably good because these types of single purpose devices can now have user interfaces that are geared specifically for that one use.
We may also see a lot of niche devices from smaller developers. I would love to see a crazy CV processor. Will we finally see a physical modeling synth for EWI players that can go head to head with the VL70m? Maybe, and with Rack Extensions it is certainly possible.
Reason has changed dramatically with this announcement, but I think it is for the better. It makes the software more personal and offers the musician a lot of choice and customization. Hopefully, we will see some dedicated EWI Rack Extensions, and wouldn't that be cool?