So being a fan of first edition, I took the first opportunity to play this at BGGCON. I played against the friendly FFG staff (one of them called me a home-wrecker because I was attacking a house and another joined in to offer assistance and bird noises, I love you FFG). Do note that this was a play test and may not be the exact game when it is released.
First, I love this edition as much as the previous. It makes a few major changes and a few minor changes, but all in all, it's an equally great game. Since it's fairly distinct, I will most likely keep my first edition as well as pick up the second edition.
Most people probably haven't had a chance to play it, so I'll go over a few of the major changes (assuming you know how to play commands & colors based game).
First, there is no war council. All lore cards have a fixed cost. Anyone that loved to play the fantasy version of the first edition will still be okay with this because of the next major change.
All units have an associated point cost. Scenarios will dictate points and players can build their armies any way they want. During setup, players place the point cards face down (including decoy cards if desirable) where they want/are allowed. The scenario cards dictate allowable deploy locations. Both sides then reveal simultaneously which units they have deployed and place those units.
Also, there are no longer banners and colors. Instead, all units in the group are the same and, unless dictated by the scenario card, do not count for victory points. The dice were changed (obviously) to reflect ranged strikes, melee strikes, and weakened strikes (weakened units have only 1 member left in the unit).
The flags/retreats now force (maybe) retreats in the opposite direction of the attack. If a unit is supported by friendly units, they do not retreat and do not suffer damage (similar to being bold). However, if they cannot retreat off the map, then they will still suffer damage. They didn't seem too certain of the situation where a unit is almost surrounded by opposition (do they retreat to the spot that is not in the opposite direction of the attack?).
The large units now have an amount of health which is tracked. Some units can cause conditions (such as poison). I would expect lots of expansion here.
The minis look excellent. The FFG staff member had to step away for a moment, so I took the opportunity to look through the set that comes with the box and there is a ton of detail in these units.
I noted one thing the FFG staff member was unsure about: the units appear to be approximately the same scale as the Descent units. The smaller units look to be slightly smaller than the Descent heroes but the larger units look to be slightly larger than the large Descent monsters. The Chaos Demon looked like it was about twice as large as an Ettin, the Griffin (I can't remember the name) looked to be slightly larger than the Shadow Dragon, and the mounted units look like the Barghest units.
All in all, I have to say that this is an auto-buy for me. FFG was a great sport and I am glad they gave me the chance to play a whole game.