rxvt has had this feature for years. It's one of those features you only miss when it's gone, and it's the primary reason I've been sticking with rxvt ever since.
I really do hope gnome-terminal's implementation is much better than urxvt's. For example, rxvt doesn't rewrap until you reach the bottom of the screen - this makes no sense to me. Rxvt cuts double wide (CJK) characters in half, Gnome-terminal wraps them correctly. When the alternate screen is present (such as when "less" or "mc" is running) the content underneath (the one you get back when you quit the app) is not rewrapped in rxvt, only in Gnome-terminal. When you resize the window the scrollbar jumps back to the bottom in Rxvt, while it does its best to keep it around the currently visible content in Gnome-terminal. I tried to take care to get all the minor details as perfect as possible, I encourage you to give it a try and I hope you'll like it more than rxvt's rewrapping