I believe that this is a big problem for new players, or the players that will inevitably hear news about this game and give it a try.
For us experienced players, it is of little consequence. This said, I believe that any inexperienced player will be very confused with all the HP bars, spells and character models that are presented in team fights.
Who is doing what? Is that a hero, or a creep? If I cast a spell, will I be absolutely sure I'm going to hit the hero I want to hit? What hero is using what spell, from where, and is he hitting me? New players do not know how to distinguish these things, whereas "seasoned" players do.
This problem does not lie in the art direction, as every champion has their own distinct persona and uniqueness. I think that the WC3 glow idea is great, and it would solve all problems with regard to differentiating the champions.