I'm sure he'll be cool looking in the movie, but its more a case of whether its really a good idea to be introducing a whole new villian at this point when Ep3 has sooooo much to tie up/set up and we already have Dooku in play and we know where everything is leading. Its not like there is an episode 4 coming out with the possibility of Grievous living on, everyone will go into this movie knowing he gets offed.

My personal theory is that they created grievous because Vader has very little (one or two scenes) of screentime. I know the marketing team is itching to use Vader's image on everything and Lucas is weary because he doesn't want people going in expecting "vader the movie" and walking out feeling ripped off. This way they can use GG to market the movie, he's basically the gimic this time around.

The other thing is a lot of fans want to see a new improved CGI super prototype Vader doing back flips and weilding multiple sabers and taking out Jedi's left right and center, but GL is wisely going the more restrained route and sticking to the classic look and with no action for dark lord. I think this is a very good thing, but a lot of fans are pissed about it.

Basically with GG he gets to satisfy both camps. He can keep Vader classy, but give the fanboys their superbadassjedikillercyborg.