A cool thing in Dark Age of Camelot was how each faction had its own identity with races as well as classes. Will TESO have the same? And do you think it should?
It should be noted DAoC eventually had 16 classes in each faction, so there were plenty of possibilities. We probably won't see that many straight out of the game with TESO even if they choose to go that route. The advantage obviously is with faction specific classes you can fledge out the identity of the factions further and create very specific vocations that fit within each of them. The extra work for making more classes and working to balancing them is the disadvantage.

They've already gone the same route with faction-unique races. The question is if they'll go the same route with the classes.

What does everyone think is the right approach for this game?

Since they have said next to nothing about classes. I would GUESS that if they did X in DAoC you can assume that will also be so in ESO.