I don't get all of it. I tried to complete this during the preview but it didn't seem to affect anything. Talk to some of the NPCs in Sanamar and a couple of them will drop hints to you about talking to some of the rebels, and one of them will sell you a portal gem to take you to their town (you can get there without the gem too).
In the rebel town, Grandmother will ask you to retrieve her granddaughter's heart from the duke toture chamber near Sanamar. Doing that will flag you as a friend of the rebels and an enemy of Sanamar.
For the other faction, if you run out of Sanamar (past the portals that go to Eastwatch and into the big castle thing) and talk to the Grand Knight, he'll give you a quest that will flag you as being loyal to Sanamar and an enemy of the rebels.
The marketing stuff prior to ToD's release said something about the NPCs not always being friendly, and sometimes even attacking the players, if I remember correctly. If that is correct, I'm guessing it may be based on which faction your character is flagged as being friendly to.
Personally, I'm kind of eager to find out.

I just haven't had the time yet to explore this part of the game. I do remember from the Preview that there are multiple faction quests, and they flag you as Friend of, through Hero of, or something like that. I think there are three different quests before you're done with them, and I think that once you make a choice on sides that you're stuck with it forever.
Check it out and let us know.

I'll do the same after I get back in game again.