A few people posted about their experiences in the OC Batman thread. Those little triangular pieces that hold the cape in place are what has to be broken. They come off with very little effort, too.
The lforigno cape has a hole in it for Batman's neck. Once you place that, you can glue or tape the triangles to the edge of the cowl, which is more movie accurate anyway. I used electrical tape on mine after reading about someone else having success with theirs. I'll post a few pics later if the sun comes out. The lighting in my apartment is really funky sometimes, and I get my best shots with natural daylight.
I know the thought of breaking such an expensive figure is mortifying, and I was feeling the same way you were about it. Still, I figured that even if I ever quit collecting 1/6 figures, I'd keep this particular Batman figure, so it was worth it to me. If you're looking to resell your Batman eventually, I'd say don't do the mod. Otherwise, it's such an improvement that once you see the finished look, you won't be sorry you did it.