You have to have it notarized because that's an extra step saying, "I'm an official with a license to protect, and this person who's filling this out and who photocopied this ID actually matched the picture on the ID and this is who it is." Basically that's the whole point. And then you send it to Blizzard saying, "Hey, Frank Smith, the name of the creator of that account, is ME. Now reset my flippin email and password, kthx."
And yes, it does make it incredibly easy to steal back an account that you sold. I used it on one that I'd sold to a guy I kinda sorta knew on my server at the time, which hadn't been logged in in over 15 months, played it for 2 or 3 months, got it to 70 and stuff, and then sold it again. Cause I'm a dirty bastard like that. And I'm pretty sure he'd abandoned it to leave it rot, so I still don't even really feel bad about that one.
Out of curiosity, I tried it with a different account that I'd sold to mmoaccounts.com, an account trading company, and Blizz wouldn't even take me to the point of asking for the notarized thing. I don't remember exactly how that one went... I claimed it was hacked I think... but they basically just told me it was gone for good, that both high level characters had been transferred to new accounts and there was no way they could reverse it. I said -- wait a minute, don't both new accounts have to be in my name too to transfer? Why can't you give me those accounts then since they're technically mine too... or whatever. I really tried pushing the issue out of curiosity mostly... and that I have little sympathy for people who spend RL money on powerleveling and shit... But yeah, no dice there. However that company does their shit, they know how to cover their tracks really well.