My read on Modular Abilities is that it is a self-contained power that allows for specific changes to the user's form (see the first sentence of "Function Follows Form"). I'd rule that any powers taken on must be reflected on your form, but that you cannot change your core shape more than necessary, and certainly not so much as to make you unrecognizable. So, for example, if you took Claws, then your fingers would actually grow claws, and if you took Wings, then you would actually sprout wings. Others should certainly notice the difference, but if Bob used Modular Abilities to grow wings, then he'd look like a Winged Bob, not like a bird or an angel or something else.
If Modular Abilities is combined with another shapechanging ability, then you have much more flexibility, but keep in mond that the power is still named "Function Follows Form", so any powers you take should reflect your form. Note that I'd also rule that Modular Abilities adds to other shapechanging powers, rather than being limited to them. So if someone had, say, Beast Form (Wolf) and Modular Abilities, then they could grow wings on their wolf form.