Having encountered the same problem myself, I tried the various listed fixes, one after another, as well as making differing characters of differing races (Just to see if -that- might have something to do with it). Removed SARS UI, fiddled with the listed files, deleted files, patched files, tried EQ and EQW both, changed resolutions and other graphics settings, effectively 'defaulted' ini's, and just a bit ago, finished reinstalling the -whole game- from scratch and setting up proper.
No luck. This definitely does not seem client side to me, as yesterday an' the day before, I was creating new characters just fine.
Ah well though. I'm sure it'll be fixed soon. I've been, aside from the lack of the Vah Shir (though I can understand the reasons on them quite well), completely impressed with this place, from top to bottom, and from the look of the forums an' the frequency of things getting fixed.. the longest this will likely last is another 12-24 hours anyways.
I will admit to being bloody curious as to what's causing it though. Improper placement of the players, lodging them in an object? An NPC with a 'broken' model or referance? Gods only knows. I just hope, for indulgance of curiousity sake, we'll be told what caused it, after it's fixed.
- Shirra