Will Armed Assault have realistic urban combat, unlike the original OFP?
Well, ArmA ( the "official" acronym, since AA is used commonly for America's Army

) will have a new 400km^2 island, there is said to be large "cities" ( I use cities lightly, since a city would probably cover all 400km^2

) and the clipping problems from OFP are also said to be fixed, so urban combat is a possibility.
You're not going to see HL2 quality urban areas however, you must remeber this IS a 400km^2 island ...
OFP was primarily an open-country simulator, the devs have said that they have and still are improving the CQB aspect of the game ( the AI included ), but my guess is they are still focusing on the more spacious aspects, since they are MANY CQQ-style games.
Also, how much will AA cost and what are the system requirements
Armed Assault will probably cost the same as a regular game, or maybe even slightly less, as for the system requirments, they released some general info: "A 2,4 GHz precessor and 1 GB RAM are adequate for a good running gaming experience at good quality. But the developers still have to do the final optimization which will bring down the hardware requirements." - From a preview for ArmA.
Unfortunately, we won't be playing it anytime soon as with this preview came the news that it would ship sometime in Fall 2006 ( pushed back from Q2 2006 ), so we'll be playing PR for a while yet

.
For anyone who's interested, here is the full translated preview from
http://forum.gamestar.de/gspinbo....ount=68 (in German) :
Armed Assault Preview
Good ol' Flashpoint transferred into a new game, with nice innovations and more beautiful than before. That's, in brief, Armed Assault, the sequel to BIS' game. While early info dated last spring talked about ArmA as a reissue of Operation Flashpoint with a few innovations, the final version will be somewhat different. ArmA is a stand-alone game even if its roots are OFP. In our preview we'll introduce you to innovations that push the gaming experience and that surprise - pleasently.
Closer to mainstream ["mass of gamers" literally]
The first info is shocking: ArmA aims for a larger target group thus carrying some changes along. If you're looking for some sop, I'll clear everything for you: We won't be facing a revolution or an attack on something we loved, but rather an adjusting of the concept. There'll be multiple difficulty levels giving us the option to save more often, to make our fellow combattants tougher, to restrain friendly fire, etc.
Hardcore gamers and fans of OFP shouldn't panic though - ArmA still features the same tough and uncomprimising world they're already used (and they'll still get their super difficult mode)
This time the conflict takes place on an island, about as large as 400 km² - that's about as large as the three islands of OFP combined. The environment is richer and more elaborate than before, both its details and accoutrement please the eye. The engine has been nearly entirely reworked, the tree generator, which lets you forget the pseudo trees of OFP, stands for that. Each tree is an object that can be destroyed - driving through a forest with a tank is sensational, and when all the trees are cracking it feels very realistic. That's the case for the whole environment: Towns can be destroyed by bombardement, fences
can be destroyed by cars, etc.
More roles in a mission
An unexpected innovation shows up on a spot, you would hardly have expected. The player will switch between multiple units which contribute to a mission, so the campaign gains an unexpected scale. In the mission we could watch in the developers' presentation the player had to clean a town to advance on the enemy's camp afterwards. While the main force is advancing on the new objective, the player takes the role of a sniper and cleans the approaches.
Completed single player missions will be available in coop mode, in which you'll be able to try out the different roles over and over.
The multiplayer mode gains importence, but at this point we want to describe the single player campaign. Altough it's shorter and it features only half as many missions as OFP, it'll feature a richer and even better gaming experience. The island the action takes place on is seperated in two halfs: The north is a post-communist run-down country whilst the south is a flourishing pro-west country. As in real life the two different forms of governments (and ideologies) don't come along with another very well, and the american army, doing a manoeuvre, intervenes in the conflict, the player will slip into the role of a soldier that is in the american forces. Although the length of the campaign will be shorter than in Flashpoint, the coop mode will countervail this.
Huge battles featuring umpteen players
We hail the reworked multiplayer that BIS has put more work on than before. The multiplayer features huge battles with umpteen players, places left idle will be filled up with bots. Due to the time such a mp game consumes - depending on the map up to several hours - the players may join in progress. The game won't restrain the number of players participating, it solely depends on the single computers. It's already possible today to fight battles with up to 60 players. That number, promising an unseen experience is only an outlook on the huge battlefields of the "future".
Due to multiplayer and the idle places filled up by bots the importance of A.I. rises, the developer team is intensively working on this topic. The enemies will be capable of calling support, taking cover - everything to make them capable of replacing real players and to make a adequate team member. The editor will enhance the durability of the game and we can look forward to further extensions (e.g. new dinghys, choppers, etc.)
It's not necessary to comment on the graphics - form yourself a view by the screenshots and the assurance that the game will look a lot more beautiful and vivious than OFP. Thanks to the used technology ArmA looks good, and it'll run on current computers without a problem. A 2,4 GHz precessor and 1 GB RAM are adequate for a good running gaming experience at good quality. But the developers still have to do the final optimization which will bring down the hardware requirements.
That alone should be enough to calm down the worries, that players of military simulations will have about ArmA. The rest of the ingredients let assume that the obsession called Operation Flashpoint - now called Armed Assault - will erupt once again. We're excitedly anticipating it.
General Info box:
Genre: Military action
Developer: Bohemia Interactive Studio
Czech publisher: Cenega Czech
Release: fall 2006
EDIT: posted while I was typing ...
ooh i have heard SO many good things about OFP! I'm definatly going to have to check out this game. It sounds like the game I've always would get made. How would you compare this Armed Assualt to the likes of PR? And by PR lets say, how do you think ArmA would compare to the first release of PR (not PRMM)?
In my opinion, I don't think there is a comparison!
ArmA will be better hands down, simply because the engine will allow for SO much more flexibility.
You know all those missions where people wanted to have to fight insurgents? They couldn't do that 'cause they needed crowds of people? They've made maps like this for OFP.
How about missions where you can have a dynamic battle where each side can "build" it's own units, factories, etc. (like in C&C)? Done.
Hell, they even have zombie mods and a JURASSIC PARK mod!
All in all, OFP had SO much mod flexibility, and ArmA is supposed to have even more!