The restrictions aren't limited to the level cap either. During the free-to-play portion of the game, players may only own a maximum of 10 gold, while trade skills are capped at 100. Players can't use the Auction House, the mailbox or even trade with other players.
Players can't use public chat channels, and will be restricted to /say, party chat or /whisper, and will not be allowed to initiate contact with other players; they won't even be allowed to voice chat. They won't be able to join guilds, let alone found them. They won't be able to invite people into parties, nor will they be allowed to join parties with players over level 20.
While much more restrictive than true free-to-play MMOs - it's even more restrictive than the 15 day trials Blizzard has offered - it still allows MMO neophytes to get a taste of World of Warcraft.