This huge new trailer looks into the development of the new Sims title. It illustrates the open world neighbourhood angle, and the development team talk about how that effects the story you're creating. It also looks at the ways in which you can build in the game world - from fabricating houses and neighborhoods right through to designing personalities for the Sims themselves. (I look forward to the RPS competition to build the most disturbing neighborhood when the game is released...)
Yep, it's looking genuinely impressive, just from the point of view of the massive, versatile systems they're building for this title. If you want a bit more depth on The Sims 3 then have a read of John's interview with the lead designer, Rod Humble.