It hasn't been disabled per se. You do need to change your shortcut a bit though. I used Process Explorer to find the command line the updater was passing when starting CoH and copied that into my link. For your reference what I'm using:
"C:\Program Files\City Of Heroes\cityofheroes.exe" -cov -project CoH -launcher -setlocale 1033 -auth 64.25.36.88
I think the only bit you really need to add is the auth bit. Looks like the location of the authentication server has changed, so without passing in the new location the login fails.
Thanks that fixed it 
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10 50's To Date! Check out Titan Sentinel; it got my CoH presence synced online
A better idea would be to add "/LaunchGame=CityOfHeroes" to the end of the NC Launcher shortcut. This causes the Launcher to pop up, check for updates, start the game and close itself, which takes about 10 seconds on my really slow computer (when there's no patch). By doing this, you make sure you are always up to date, but can quickly load in without having to click through the Launcher.
@Roderick
I've been using this for years to avoid the updater(even more so with the NC one I don't like). I just tried it tonight, with both my accounts, and while having an active internet connection I can't connect to the login server from the shorcut on my desktop with the -project coh flag. However launching coh from the ncsoft launcher works fine.
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From playing beta I saw they ruined the -uiskin flags, but I didn't think they'd be altering others like this
10 50's To Date! Check out Titan Sentinel; it got my CoH presence synced online