I don't think it will have much negative affect:
Yes, lvl 60's won't be able to compete with level 70s in PvP. The same as lvl 50s to 60s. Battlegrounds are such that lvl 50's don't compete with level 60s. Battlegrounds post expansion will likely be level specific or based on wether or not you have the expansion. As it stands, the Warsong Gulch and Arathi Basin Battlegrounds see level 60's having their own instance so those below 60 never compete with lvl 60s.
As for outside of the battlegrounds, well, it will be an interesting twist to see 60's being ganked.
As over the triviliazation of all the lvl 60 and under instances, I don't see that as an issue. As it stands, I can solo SM and below on either my priest or rogue, doesn't mean I do it. I doubt MC will ever be 5 manned. And even if it could be done by 5 level 70s decked out in new epics\legendaries\artifacts, it doesn't mean it will happen. I still see groups of lvl 60s wiping in Sunken temple, ZF and Maraudon and even funnier, in the hallway to the final boss in Gnomeragan.
Guilds that have MC and Onyxia on farming status can do it without a full compliment of 40 people, in a sense, they have already become trivialized by some.
