Age of Conan's rendering engine dynamically occludes objects, including moving ones, to save framerate.

In plain English, that means players and NPCs can appear or disappear depending on how many of them there are. This can be both good and bad, it's not a perfect system but it does keep the framerate sane in busy areas, while also allowing for some pretty extreme ranges when there is less going on.

This vid clip demonstrates how players can still be seen at far distances. If you can make it out (video compression blurs it), that little dot jumping up and down is Michelle playing on her Priest of Mitra:

You can spot her character better once she starts casting just to get noticed, she lights up like a candle. If she were fighting mobs, you would see those too.

The opposite of this isn't as fun, in some of the crowded city and town areas, NPCs and players can pop in and out of existence rather close to you. Hopefully Funcom continues to optimize it, because the potential here is amazing.