Allow me to elaborate further:
When we create human models for our games, we use Blender etc. to create the model, then put a skin/texture on it, right.
So inside the game, the best customisation we can possibly provide is for the player to perhaps choose from among various skins for the character, the basic mesh would remain the same size and form.
What these Entropia guys have achieved is remarkable in the sense that you start with a basic model, then with one slider you can change the size of your head, with another slider, the size of your torso, with yet other sliders the size of your legs, arms and so on. With another group of sliders you can change your facial contours. Then there are sliders for prcatically infinite colors of hair, eyes, skin etc.
The end result is that every single character in the game is guranteed to be totally unique.
Just like humans in real-life
How exectly are they doing it ? It seems as if they have an entire Poser running behind this GUI and models are being created on the fly.
Or else some clever trick is being used.