MakeHuman is an open-source (CC0 License+AGPL) 3D Model Generator currently being rewritten from C++ to Python. By default, it uses sliders and checkboxes to configure and produce (from template) a detailed human model. Basically the same setup you see in a lot of newer RPGs, such as Mass Effect. It can also export these for use in any standard 3D Modeler, such as Blender.
The latest Alpha build (1.0.7, still C++) has a decent selection of options for the initial generation (if you look under all the tabs). There are some limitation due to a lack of resources and some visible errors resulting from mistakes in the available resources or coding. I haven't taken a look at the 'Pure Python' build yet, but plan to do so soon enough.
Thankfully you can create custom resources for the generator (skins, clothes, etc.), in much the same way as you would for 3DCG. It's also implied here and there on the MakeHuman website that you can change the base skeleton, as well, which opens up further possibilities, especially when combined with the integrated Pose Editor.
I think this is a bandwagon we should jump in on early. Why don't some of the people here who are good with 3D modeling go create a few resource sets so that the less skilled have something besides SecondLife and (hacked versions of) 3D Custom Girl with which to make fursona models?
tl;dr Free 3D Model (human) auto-generator needs resources for the Furry Community.