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The reason that legacy apps will need to be reworked is because the ARM instruction set differs quite a bit from the Intel x86/x64 set. How much work is still anyone's guess, and it will likely vary from app to app. Peter Bright from Ars Technica recently posted about .NET business apps, stating that "While legacy x86 applications wont run on ARM, business applications written using .NET should run unmodified, and as long as ARM Windows really is Windows, and contains all the things that regular Windows contains recompiling existing applications to run on ARM should be a relatively trivial affair."
When Windows 8 ARM tablets hit the market, developers and end users alike are eager to know if they will have the ability to run "Desktop App" i.e. apps that are not created in the new Metro-style. It's a given that legacy Win32 apps won't run without some work, in fact, all legacy apps will require significant work and/or recompilation, but the question is, should it even be an issue?