I disagree with any decision that sacrifices gameplay for graphics.
I stand by this. While this'll help the appearance of blockland, it'll completely hinder the gameplay. You cannot build giant, complex terrain objects without clogging the server with an enormous amount of bricks. A lot of the community's creativity is not only derived from how things are built, but how they're built around specific environments. Not to mention the fact that players are able to create their own, individual environments to satisfy individual needs. Also, many vehicles do not have the physical ability to ride appropriately on bricks. It seems like you'd be creating an incredible amount of issues for not only the game, but the people playing it, if you made this completely default.
I think the best way to deal with this would allow for each host to have the option to choose between this new version, and the old. It isn't a step forward to completely rid of a large set of nicely crafted tools, simply because you found a new set made of gold.