Noticed this a bit earlier today, did a bit of investigation.
Apparently the exploit had been used by a group of three WoW exploit writers for a while, mainly to do runs of the Baradin Hold instance - combined with a teleport hack, they could clear out the instance in no time, earning a lot of gold. Finally blizzard caught wind of it, banned one of the guys, and then the rest got pissed off, shared the exploit with a few others, and set off to disrupt the major cities of several servers.
Some weeks earlier, one of those guys had found a way to *crash* entire servers, afaik by sending some malformed packets.
A couple of references:Baradin Hold InstakillServer crash exploit