Deeply horrible change IMO. Huge disadvantage to serious photographers, both because film sims are useless if you shoot RAW, and because having quick, convenient and reliable access to the drive modes is very important if you are shooting action/wildlife. Also being able to switch to video in a hurry is very important (an entire dial on the X-T4/5!!!)
This single-handedly makes me reconsider my plan to insta-preorder the camera. Along with the price, it makes the X-T5, despite being heavier than I want, look like a good deal all of a sudden. I don't even want an ISO dial, but having a film sim dial always there being completely worthless is offensive to me.
Am I being fussy? Yes. Why do I even buy Fuji cameras in the first place rather than cheaper technically-superior full frame cameras? Because I am fussy.
We haven't seen the whole camera yet
This is still just a rumor, so I wish I could think it's fake, but it seems real.
Still, it's possible there's another drive wheel on the camera somewhere, such as if it replaced the "auto" toggle switch under the shutter speed dial. It's probably not under this film sim dial, because that's where the flash release goes and I doubt they changed that.
If there is a drive wheel, that will help this decision not be such a train wreck, but the film sim wheel is still a really bad choice for serious photographers.
Dials are for quick changes
Suddenly having a fast subject and needing burst mode, or suddenly wanting to capture a video, comes up a lot in my experience.
Suddenly needing to change the film sim without lifting your eye from the viewfinder: Never.
Dials should be for things that you need to change quickly, not for things that you ponderously change when you are feeling bored, and can change in post-processing.
This dial should be customizable
As someone else said, this would be better as a blank dial because film sims are 100% useless to RAW shooters, though personally a drive dial strikes me as worthwhile.
We can dream that they will do the right thing with this dumb film sim dial and allow us to get the same effect as a "blank dial" by customizing it to act that way.
With the "C" position, it definitely looks like a wheel that can spin forever, so they should let us make it into a third generic wheel who's outcome we see on the screen. Letting us customize it this way would mean we also regain a custom button from elsewhere on the camera, since most of us probably have that "most important other thing" on a button somewhere.
I would probably make it control ISO, e.g. to shift between the three auto-iso modes by turning the dial.
You could also have it control drive mode, assuming there's no other physical control for that.
AF modes (wide/zone/point) would be another option you could switch between using the dial.
Honestly if they work that out, it will save this dial in my mind. Yeah it's ugly but as long as it's useful, I can forgive it.
Of course, they could have done the same with the drive dial if they thought it was useless, but they did this instead. I don't think they'll make this dial configurable, only that they absolutely should.
Hope the people who like this change really love it, because for those of us that use Fuji cameras as tools, this is a really big downgrade and waste of space.