You meant 2003? The old DAOC engine they are using in alpha is just a placeholder i read somewhere?
There is some truth in it - models and animations are placeholders, but the engine is actually brand new, made from the scratch by CU team and it's a real monster performance-wise. We are talking next gen, nothing to do with 2003 or 2013 (or even 2016, one could say).
Now, in order to early-test stuff they needed something in the place of models/characters. For testing purposes, it could be a giant moving pixel or a cube, or what they have now. This is certainly not the "modern" alpha/beta used to sell stuff to people.
What I'm interested in is the combat and animations in general, that is tough to make right and will take lots of time (and it WILL be at least somewhat rough even at launch, they are not on AAA budget) - new textures, lightning, makeup etc. will be added much easier, when the time comes.