The picture shows one of the weird bugs you get from time to time. It's a Black Guard and the "deformation" will stay on your screen until you zone. It looks really weird if a player is running around like Mr. Fantastic. Talking about Black Guards, i recently saw some pictures about their Sovereign gear: gallery 1, gallery 2.
Everyone likes to speculate about upcoming patch notes. Often early posted patch notes are fake, sometimes real. Until nothing officially is being said, you've to expect the "leaked" patch 1.2 notes to be fake... or change completely before the patch. If you want to read them and speculate yourself: read here. I won't comment on them until i know they're real. ;)