City of Villains is not (strictly speaking) an expansion to City of Heros because it can also be used as a stand alone game. You can buy CoV, install it on your computer and play it without ever having touched CoH. If you do that and later decide you want to engage in Villain vs Hero PVP you will need to buy CoH.. to act as an expansion for your CoV game.
See the distinction here? They are two stand alone games that interact synergistically if you have both.
On a different note, when I was at Origins 2 weeks ago I was told you still started with no powers at 1st level. It's possible the guy behind the counter was wrong of course, I didn't think to confirm with Statesman because I hadn't heard there were conflicting rumours.
-Andor
