And that's the best way to describe it. We can talk to NPCs on our mounts, go through doors or "portals" on our mounts, emote on our mounts, use certain skills on our mounts. It makes mounts less of a simple point-A-to-point-B device and more a part of our character. And as a skill, mounts no longer take up space, so that means we can collect as many as we like without having bags or bank space devoted to our stable. I know this will give me a new money sink on Jaxom. A horse of every color and variety for me please!
One last thing: the dev diary has a little blurb at the end pretty much trying to say that this mount system change was not designed to take on mounted combat. However, despite this, they do say the system was designed for expandability and flexibility. I think mounted combat does fit into that design feature.
And lastly, at this point in LOTRO's life, it's a little known fact that mounts weren't going to be in release until quite late in the development process - the dev diary alludes to that as well. I for one am supremely happy they did make it in, even limited as they were. It would suck to run all the time and could have been a serious stumbling block to player retention.