Both, full details here:
http://forums.civfanatics.com/showthread.php?t=229557
Here are 10 off of the top of my head:
1. Improved AI (even if there was nothing else I would upgrade just for this).
2. Fix for the MAF crashes.
3. Firaxis added a lot of FfH functions to the main game (quick combat for spells, preffered religons, hidden nationality, help tag, feature attack bonus, dynamically adjust unit strength, support for dynamic leader switching, etc).
4. Civ specific unit art. Bringing the unit art definitions into the SDK allows us to play with them (I could, for example, change a units art if it becomes undead, gains an imp, etc).
5. Simplified formation and Lsystem.
6. Events and quests.
7. Modular XML will make life so much easier for those who want to mod FfH.
8. Mod specific interface.
9. Diplomacy options that players can opt out of.
10. Espionage.
Its no coincidence that we have been waiting for "Shadow" to add diplomacy, quests and espionage functions to FfH. It also probably makes sense why we haven't invested much work on hidden nationality and AI work.
We've always planned for FfH to be on BtS (which is why we never considered moving to Warlords). I just didn't expect BtS to be as cool as it is when we origionally planned it.