<<
<Question>
Does this refer to the generalities of choosing race, class, etc, or
does this restrict any d20 product from adding/changing that initial
effort? Does a product (like Darwin's World) that adds a new category to
character creation (Background) violate the d20 license, since it has
changed the character creation process? On the opposite side, does a
product that does not use alignment for character generation violate the
d20 license?
>>

Refer to Pages 4 and 5 in the PHB.  That's what's meant (last I knew)
what you're not allowed including in a d20 covered product.

You can change how characters are created, you just can't describe how a
character is created in a d20 covered product.

<<
<Question>
If level-based abilities were added to a race (say, granting a new feat
every 4th level level), would this violate the d20 license? Is the
ability score increase every 4th level also considered part of 'applying
the effects of experience to a character'? Is the feat acquisition,
skill points and ability score increase all considered mandatory for a
d20 product?
>>

Refer to Pages 145, and 146 in the PHB, starting Level advancement. 
That's what's meant (last I knew) what you're not allowed including in a
d20 covered product.

You can change anything about character advancement, you just can't
describe how to advance a character in level.

What you do, is write a Character Creation/Advancement Guide, which
doesn't include the d20 logo.  Include all your changes, and brand it
with the same logos (minus the d20 logo) as your other d20 products. 
>From there, hope that your customers link your character creation guide
to your d20 products.

Including a note in your d20 products on where to find the character
generation/advancement instructions are also not allowed, as you are
indirectly telling the customer how to create a character by telling
them where to find it.  That's all IMO, though I believe it's been
agreed upon.

--
Korath,
http://www.korath.com
"He was already dead, he died a year ago, the moment he touched her.
They're all dead, they just don't know it." --Eric Draven, The Crow
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