To elaborate, but not give the math away....
Intelligence now effects how well placed your strikes are on your enemy, as well as how well you put your armor between you and your foe when you block. A big strong dolt will land crushing blows, but might not have the strategy to hit every single time. Conversely, a weaker but more intelligent character will find his lance striking his foe's weak points almost every time, but those blows will do less damage individually.
So, if you keep your intel too low, you will find yourself missing strikes as your character fails to take into account dodges and other slick moves of your opponent.
Don' t think that you should dump all your points into intel, though... it might be better to miss 1 out of 10 attacks but do 200 damage each, rather than miss no attacks but only do 150 damage.
[numbers are just examples here and do not reflect any actual game formulas, so don't read into the 200/150 thing]
Cory will be watching this all for imbalances, and I will be watching to see if creatures need to be adjusted to compensate.
As Cory says, this is a fairly major change... please report any strangeness to the BUGS FORUM.