One of my pet-peeves when roleplaying in an MMO are the people who have decided to create their own lore and abide by it rather than the setting of the game. While certainly, they have some right to do that, and if their circle accepts that it seems fine. However I find all too often that in MMO-RP this person wants everyone to accept their revisions. I think this irks me most because the way I see it, Roleplaying in an MMO or other game is akin to co-writing some fanfiction....there's give and take.
Like with everything, there are degrees of offense. In a way, simply creating a character is revising the world in some way. The issue is more about how big of a "ripple" the revision makes in the fabric of the story. To use Warcraft lore as an example; creating a soldier that was "present" at the battle of Icecrown Citadel and "assisted" with Arthas's defeat really doesn't change anything. On the other hand, creating the illegitimate child of Thrall/Jaina would drastically shift the nature of the story.
The inevitable problem is that I cannot articulate a clear rule as to when a person is swimming happily with the current of the story and when they are trying to divert the proverbial river. Instead I would offer a more preemptive test based on a few I have encountered in my brief tenure as a law student.
The first is called the "laugh" test. If you can, aloud, describe this character and their background without at any point laughing or feeling foolish, then the character is probably at least initially safe.
Second comes the "ripple" test. Which is to ask yourself, would the existence of this character in the long-term storyline have had a drastic effect on how things would have occurred? If the answer is "yes" then you've crashed into the riverbank.
My own standard is that I tend to try and stay with the current as much as possible. Part of that is because I think it perhaps a bit silly to go into an MMO world with the intention of ignoring or modifying its lore. I RP'ed in WoW because of the Warcraft world, not in spite of it; a mentality I have carried with me into Guild Wars 2. Thankfully I have yet to meet any trans-dimensional demi-gods (admittedly one of the more amusing modifications I encountered in my WoW tenure), children of Alextraza and Deathwing (though one could almost argue for some of these, but the player would be hard pressed to prove it), or "true" kings/queens of Stormwind. Some of these ideas surely are creative, but the point of RPing on an MMO with an established world is to play with others in that world, not in your version.