Page 3 of Chapter 2 has a section on "clarifying" the term outsider which I think muddies and complicates the issue more than it helps. It's very much a legacy of what the prevalent thinking was in early 3.0 edition, when the term outsider was very vague and *needed* clarifying. Back then, outsiders were said to be (as the document says) any extraplanar creature which isn't an elemental, and many in the Planescape community were very concerned that this definition didn't work in a campaign where just about everyone is extraplanar.
Nowadays, in 3.5, outsiders are defined very specifically in much the way that Chapter 2 suggests. As the SRD says: "An outsider is at least partially composed of the essence (but not necessarily the material) of some plane other than the Material Plane." That's very close to Chapter 2's "The creature type 'outsider' is reserved for creatures with a particularly powerful connection to their plane." As we all know, there's an extraplanar subtype to handle the many examples of creatures who are extraplanar but not outsiders. The same section talks about "native outsiders" as if they were something that only existed in the Forgotten Realms campaign setting. This was true at the time that was written, but obviously isn't now, and should be changed to take that into account.
I think this citing of 3.0 rules as if the 3.5 revision didn't exist just muddies the water. I understand the desire to distinguish between what Planescape called outsiders (the Clueless) and the creature type, but what's really needed is a clarification of how the extraplanar and native outsider subtypes interact with characters in the Planescape section. Under what circumstances is a character considered to be native to Gehenna? Is it sufficient to be born there, or do your ancestors have to hail from there as well? How long does a family have to live on another plane before they can be considered to be native to it, if ever? These are things that WotC has never defined (Customer Service says it's up to the individual DM and there is no official rule), but which it would be very useful to know in a Planescape campaign.
The distinction between primes and planars should also be rethought in light of the present rules. I think it's important for the sake of factions like the Planarists that the terms be preserved in-game, but I think the extraplanar subtype handles all the rules elements of the dichotomy. I'm particularly concerned about handing the ability to sense portals to planars for free, since primes no longer get anything in return. I also doubt the logic of the rule: wouldn't a prime from a particularly magical and portal-heavy part of the Material Plane have as much or more of an affinity for portals as a character from some isolated demiplane or primitive Hinterlandish village?
About the line "in contrast to the ignorant primes": While I view Planescape's rants about the ignorance of primes with affection, it should be remembered that this was one of the things that turned people off the setting the most. The irony in Planescape's 'voice' seems to escape some people, who view it as an actual attack on their favored campaign settings or play styles rather than in-character ranting for the sake of flavor. I move that part be cut out unless it's found in a quote from a NPC and countered by an example of planar cluelessness.
It also might be useful to acknowledge on page 4 that "proxy" has a different meaning in the official rules than it does in Planescape.
The art is beautiful, by the way.
I must agree that I find the terms being used a little confusing. But then, I've always been a little confused...
Am I an outsider, or merely extraplanar? Am I a native, or a stranger? The identity crisis of people-not-from-the-prime must be staggering in 3rd edition.
The art is also good. No confusion there!