Sounds a nice idea, it would certainly appear easier than havin your actuall character doing these thing, Also it owuld mean the load was on the client and not the server.
2 points though, 1 is what would you do for all the different races and all the armour combinations? 2 is that it would increase the download size signifigantly, especially if all those combinations were catered for.
OOOOhhh, ive got a 3 aswell lol, you owuld have to encode the cutscenes in some format or other, DivX springs to mind but that woul cost money id think, maybe Xvid would work but do Macs support it?