To clarify: the item pictured above is from Heroic Mogu'shan vaults, aka item level 502, except on Asian servers it drops with 2 upgrades built in and a further two available to purchase, so the sum total of eight higher item levels compared to 10 man on Asian servers and to both on US/Eu servers (because of the extra two upgrades). I've also added the maximum ilev - 525 (non-elite) for Terrace in the title so it's clear.
So yes, as they stated in their blue post about 10/25 man separation, Blizzard have gone through with upping the item level on 25 mans on Korean and Taiwanese servers (Chinese servers will be getting this update next week). The gear dropping from Mogu'shan Vaults Heroic, for example, is ilev 510, aka the same as a double-upgraded item on US/EU servers, except it can then be FURTHER upgraded to item level 518. To make things more fair Blizzard have also buffed the 25 man bosses with 10% extra HP and damage. So 25 man guilds on Asia servers have an 8 ilev advantage over 10 man guilds (and the US/EU, but the extra 10% MIGHT compensate for that). This brings up several issues.
First of all the Asian guilds currently progressing through Terrace of Endless Spring (Stars most notably) and perhaps lower ranked guilds in Mogu'shan and HoF, have been hugely shafted and basically made to lose a week of progress, at least. With the bosses being 10% stronger and their gear being basically the same (with 1 reset's worth of upgrades), it's now extremely difficult for them to down the boss (and Stars apparently had a sub 1% wipe before the patch). Seems like it and it shows a MASSIVE amount of disrespect from Blizzard to experiment like this in the middle of a progress cycle.
Next Tier Race
The other major concern is the next Tier of progress. Will this improved item level be a factor? Will the new bosses be the same HP and damage level as US/EU, or will it be the 10% stronger versions? And even if it is the 10% versions these are not the same bosses any more, who's to say that the better ilev of drops is exactly equal to 10%, it could be easier or it could be harder, it all depends on the individual bosses. Will this make Asian World Firsts basically separate?
The System Becoming Standard
The final and perhaps biggest issue here is the old "well, maybe they will bring this system to all servers and are just testing it" argument. Ignoring for a second the fact that the last time they tested things out on Asia servers it didn't make it here (the double reset), would this even be a good thing? It would basically make a new tier of improved loot for 25 mans that 10 mans wouldn't have access to. Some think this is a good thing and is how it should be, god knows 25 mans definitely need something to change considering the rate those guilds are disbanding at. But others don't want to be forced into 25 mans in order to get the best loot, so this move seems like it will stay limited to Asia servers, although we can't ever be sure with Blizz.
All in all, it's an interesting move, but implemented at a terrible time and it has the potential to completely remove Asian guilds from the World First race (it basically already has, since either version of the next tier will simply not be compatible with US/EU).