It's a bit harder than that, with the new engine and all.
What the heck are you people talking about. The engine has nothing to do with it.
The game (or moreover the code written for a climbing feature) would need to measure what incline you are walking on, likewise if you hit the "climb button" on a adjacent surface, then it'd cause you to latch onto it. It you hit a 90 degree angle then it'd consider it a wall. The game would check what the surface is made out of.. stone and rock surfaces would be climbable. When you hit the "climb" button (or whatever) it'd put you into a new movement animation. If the surface is just a steep incline, then it'd be a more horizontal climbing animation, whereas as you go up, it'll turn into a full fledged climbing animation, you reaching for stones in a wall, or slipping your hands into the cracks of a rock surface.
It wouldn't look amazing, but it'd work, and hey, it's a climbing ability. So long as they did good animations, then it'd look fairly convincing, even though you're climbing a flat polygon surface. They've got the new havok aniamtion system, some I'm going to assume they could have "smart" dynamic animations, where your character may feel around the wall with his hands looking for something to grab onto.
I really hope there's going to be climbing
and wall jumping, that'd be bloody amazing in an elder scrolls game. albeit both those skills should only be available to somebody with the correct perks.