I'm ambivalent to this, and I have opinions on both sides of the issue.
Pros:I like the idea of reducing inspection, because from a non-cuber perspective it is strange to see people look at the cube for longer than they solve, and the time only counts as the solve time. Over the years I've heard a number of people, non-cubers, ask at competitions "isn't that cheating somehow?"
I'm more of a fan of going to a no-inspection style, but Ron does raise some good points about orienting the cube, aligning all slices, making sure the cube is the right distance from you, etc.
So that is why I am in favor of reducing inspection.
Cons: I do see why it would be frustrating to people who use methods who rely more heavily on inspection. I would also be affected, as I practice X-cross solving purposefully so that I can see them easier and solve using them as often as possible. I am probably, on a good day, up to about 40% of all my solves using some sort of block building/Xcross solving technique instead of just the cross. I would certainly not do Xcross anywhere near as often with shorter inspection, it would simply not be a good idea to do so.
To those who are up in arms about how they feel the change affects them too harshly, how do you think the people back in 2003 who practiced Siamese cube, or Rainbow cube feel now that their events have been completely discontinued? I don't bring this up to say the WCA should bring these events back, that is simply not feasible, but only to illustrate that sometimes big changes are implemented in order to help the sport as a whole.
General Thoughts
I do think having a significantly shorter inspection time, or eliminating inspection altogether, would give cubing a much higher credibility factor amongst non-cubers and could help us become much more of a "mainstream" sport. Seeing as how growing cubing as a sport is part of the mission statement of the WCA, then I think this is something that should strongly be considered.
Changes to your solving strategy for inspection heavy methods:
On a final note ZZ solvers and the like, myself partially included, who do use more inspection could benefit from this line of thinking. Just think of the part of inspection not completed as the part to be finished during the first part of the solve. So for example if inspection is reduced to 5 seconds. You will use probably 2-3 seconds to orient the cube, and count some or all of the flipped edges. After the solve time starts you will, on the fly, create the solution to the EO line. Don't feel like you must abandon your method entirely, it will only be a motivating factor to do more with your available 5 seconds, leaving you less to do during the solving phase while the timer is running. With practice you may be able to see the EOline solution in it's entirety during the inspection time + starting the timer time (where you can still see the cube and think about how to solve). The other possibility is that this change will eliminate ZZ as a speedsolving method, because it relies too heavily on inspection, but I have a feeling people are resourceful enough to come up with changes to allow ZZ to still be used as a very competitive method even if the new change went into effect.
On the whole, I guess you could say I am more in favor of reducing inspection than I am against it.
Chris