Gist - Hair is not staying attached to character model.
Created Warlock female (human) with pigtail hair style.
When running around the hair jumps right off of the model, and seems to float in mid air. It will catch up to the body after a while. Standing in place seems to speed up reconstruction.
Please see the following video:
I was playing with a friend, and they can see my toons hair bug as well. They have a human female hunter, and this issue is not present in their toon, so it might be localized to only certain class/race/Gender combinations.
Also general frame rate is low throughout the game, but I assume this is due to debug code still being in place.