I hope it doesn't become a totally fractured continuity though like K9.
Actually, it's not fractured, because it's established that the K-9 featured in that series is the original one that was left behind with Leela on Gallifrey, and he looks the same in the first episode until he "regenerates". They even kept Leeson's voice. And I understand the show takes place something like 50 years in the future, which they did in order to steer clear of Sarah Jane's time frame, as well as that of recent Doctor Who. Just because they don't spend their time talking about the Battle of Canary Wharf doesn't mean it didn't happen (then again, depending on one's interpretation of the events of The Big Bang, maybe it didn't happen...).
As for Torchwood, much as I'd like to see further connections to DW, I don't think it'll happen anymore, since Starz is calling the shots now and they won't want to connect to something a rival network is doing. Best we can hope for is maybe in Series 5 they'll be able to borrow Freema from Law & Order or finally get around to bringing in Noel Clarke as Mickey. But I'd say it's doubtful, not if they're able to snag big names like Francis Fisher to guest star.
I'm also of the opinion that it's probably the last we'll hear of Torchwood in Doctor Who too. Despite the stated desire to have Captain Jack meet Matt Smith, as long as Doctor Who is on BBC America and Torchwood is on Starz, it won't happen, regardless that both series share networks in the UK. It's a price to pay for the increased American influence on the show.
(Of course, having said all that, if next week or next year the BBC announces the great crossover, I'll be more than happy to eat my words as I'd love to see Nana Visitor squaring off against the Daleks!)
Alex