While you were previously restricted in the sense that you could only use the finite (though incredibly large number) of appendings available, there was zero regulation over them.
The more correct term would be standards, and there absolutely were/are (and frankly, even some regulations too). You cannot get a .mil name unless you are a US military site. You cannot get a .gov name unless you are a US government site. You cannot get a .edu name unless you are an accredited education organization (that gets a bit trickier though). You're correct that the .com and .org restrictions were not fully enforced, but that's largely because it was pretty impossible to do so. You technically had to be a registered non-profit to get a .org name, however over time the means to determine what that was became complicated to the point that they pretty much just gave up.
And frankly, the practice of large organizations obtaining names and then selling/leasing parts of the space did make those distinctions irrelevant. But from the top level perspective, that really only applied to .org and .com and frankly, no one really cared that much how strongly those rules were enforced.
Country top levels are enforced though. Only the authorized name space org (authorized by the country in question) can hand out names within that country's domain.
There was absolutely nothing preventing a business from choosing .org over .com. And many companies got creative and used coutry codes such as .tv for websites pertaining to television (the main export of the island of Tuvalu).
Again though, that's not a problem with enforcement or regulation at the top level, but the fact that once someone owns "cyb.org", they can turn around and sell "ima.cyb.org", "youra.cyb.org", and any number of variations they want to anyone they want.
The real issue with this change is the sheer number and variation of top level names (and the ability to create new ones for what is actually a pretty cheap price), As stated, those with any sort of trademarks involving name recognition will have much more trouble dealing with copies of their name out there. And you can bet that there will be a scramble for various enterprising groups to buy up names they think they can then parcel out and sell to other companies and organizations.
I suppose the flip side is that it may put some upper limits on how much someone can extort for a name they purchased ahead of time that someone else later wants badly. With the ability to create so many new top level domains, that someone can probably find some other name combination that will suite them just fine. It's a trade off I suppose. Edited, Jan 12th 2012 7:09pm by gbaji