I really want more details about this .I don't want to ask my friend to buy this game for a custom rpg if nothing could be done.
So i'm hopping some larian's peoples will read this and make a making of video of a GM game .
I'm in the exact same situation as you. I hope Larian understands that this would be a huge part of the market. Not everyone is a Divinity Lore fan.
Custom spells, abilities, etc...can be done, but It requires a lot of knowledge about scripting and modifying data, Baardvark is the boss around here for that subject.
Coloring armor i think it's a thing but not coloring weapons as far as I know. You'll have to edit textures for that (Please, someone correct me if i'm wrong)
Create custom races and monsters and stuff...we've been debating long and hard about that. Problem is animation, D:OS2 uses a third-party software for that called Granny3d so i don't know how can it be made since some people uses blender, some of us Maya, and/or Max, and there's no information about if we are going to get an exporter/importer, what would be the format file, etc (What I know is if this is going to be just a blender plugin the game's dead for me)
Another issues that we've been discussing are DnD-likeness, subjects such as levelling, prestige classes, feats, challenge rates, would be hard to adapt to Divinity. Also things like swimming or covering in combat aren't possible (I'm still in shock when they told me there was no cover, in a turn-based squad rpg. Imagine Shadowrun or videogames like X-Com without cover O__O )
Also you can't create custom scripts in GM Mode, only inside the editor.
Also there's the 4 player limit which i hope that a mod to increase that limit would be 1 of the first mods to be made by the community. Some of us have more than 4 friends, hahaha.
So in conclussion...yeah, most of things can be done...problem is without any wiki or documentation or something most people won't know where to start. D:OS1 and EE were difficult to mod and most things were just reskins and stuff like that. I think everyone here has fingers crossed wishing for Larian not to make the same mistake. Not when they give us a GM Mode.
Please Larian don't do Sword Coast Legends again. Give us freedom.