Would finally be able to use my avatars to walk around in.
Will have to reskin it though... :/
It'll be quite a while I think until this is actually implemented, as I don't think it's one of Craig's top priorities at the moment. However we'll just have to wait and see.
Don't quote me on this, But I think it will be an easy mod before Craig decides to add it. C# mods have been shown to be able to change GUIs, And the models can be added with XML mods quite easily.
I think all that someone would need to do is make a mod which gives a config menu to decide which NPC models are allowed in the avatar selection screen. Then you can add models with XML, And boom.
I realize that this is oversimplifying the process, But it should work just fine.
As our friendly neighbourhood RGH modders have shown us, It is possible to wear any NPC model as a skin if it has a crouch model assigned to it. So as long as there is a way to make a crouch model for the NPC, It should work just as well the real thing.
Granted, This would only work if everyone had the mod with the models, But that's fine by me as a world creator.