I don't think WOT could loose too much, and certainly not half the story, without being transformed into a fairly generic epic. WOT owes a lot of its success to its details and intricacies, a lot of its humor to "daily life" situations that happens in daily life kind of scenes that typically would be cut etc. - it's a series that is loved by fans of its immersing details. The 3p limited POV device is also a problem. A lot of the flavour of the series comes from this device and the special relationships it creates between reader and characters, and it can't be adapted to the screen. Just that would change the tone of the series massively on film. The perspective of the audience on the characters would change a lot if they're seen from the outside... unless you add scenes and dialogue to show the character points you used to get as reflections in the POV. You can't have Elayne think her opinion on Rand or what's he's done during a scene she's getting dressed, you need an additional scene where Elayne tells someone her opinion of Rand. Etc. The series would need to be expanded - Jordan used to do a lot with reflections within a chapter. It's also a series with tons of exposition, which is not a good thing if you need to adapt it for the screen.

The other problem is that the subject matter and style of the series pretty much means the main audience will be the books's fans (which is a problem), and so you can't have them scream murder at the adaptation or you're screwed. The success of LOTR and HP on film rested a lot on the fact a massive enough part of their fandom remained loyal to the adaptations, despite criticism and issues and the purists screaming in the dark. The studios pick massive book successes for a reason. Their fandoms become hype machines attracting wider audiences. HBO's done the same with ASOIAF, but it looks like they've avoided mistake #1: disappointing the fans with the adaptation. It will have massive audiences at first, it's been marketed well so far, but it remains to be seen if even this series with a huge potential for mass appeal (at least, among HBO viewers) will manage to sustain its audience long enough for HBO to film all books...

WOT is not really a series that could endure a massive shortening without losing its peculiar flavour and becoming extremely boring and bland. Given its soap-opera-ish style and episodic nature it would lend itself much better to a regular TV show than to cinema (the usual 20+ episodes/season, about 2-3 books per season) but IMO it wouldn't appeal to a large enough audience to get a decent budget or chance to survive its first season (casting alone would cost a fortune... so many recurring small parts...).

The bottomline is that there just isn't much point in adapting this series (aside from an animated version, which I think would have worked well with the style and humor, and evacuate most of the adaptation problems). It's just not good material for cinema, the first 2-3 books aside. On TV the formats and/or budgets just can't do it justice either considering the material just doesn't have the sort of appeal that made series like Lost, and if it's to be butchered and streamlined, it wouldn't be very interesting to the fans of the books except as eye candy. One would have to be blind to believe WOT could get the sort of HBO treatment ASOIAF is getting - it simply doesn't have the proper style or content for that sort of big budgeted adaptation.

Really outstanding Fantasy could be done on film, mini-series or even on a regular TV shows, but a few exceptions aside the studios would have to understand first they need not buy rights to existing books but rather hire a Fantasy writer to create a world and its series written directly for the screen, evacuating from the start all the problems pertaining to the genre in written form, and taking advantage of the different medium and format (as it's been done with SF... SW, Star Trek, B5, Firefly etc. - those were all written for the screen).

WOT for this is a lost cause, IMO. To make it work, they'd have to change what makes WOT WOT too much. Some stories are meant to remain in written form, and I think WOT is one of those.