Oh wow! You seem very knowledgable on this subject.
I love the
idea of MMORPGs, but have never found one that I could enjoy. However, my experiences are from long ago, playing the kind of free* MMORPGs that we used to play here in South Africa. In modern times the whole design of MMORPGs have wandered away from what I want to play. The only MMORPG that I have played legitimately is Guild Wars without any expansions, up to the third act.
(*Free as in you use a hacked pirated client to log in to home-made server software running on cheap hosting.)
In my experience, the main barriers to entry is economy, community and cost:
1. A bad economy leads to inflation, which means new characters cannot afford to get started. (i.e. starting money = 100gp, starting armor = 10000gp)
2. A bad economy can cause certain economic activities to become useless. (i.e. Vendor sells potions for 6gp, cost to make a potion yourself is 50gp)
3. Power level differences automatically stop you from playing with your friends, since they play more/less than you and thus level up slower/faster.
4. Optional expansions also split the player base and limits the kinds of content allowable in expansions.
5. Shy people like myself find it hard to initiate conversation with random internet strangers while playing a game.
I want to rant on all the horrible/funny specifics of non-legit MMORPGs, but choose to restrain myself.
Meanwhile, I'm trying to design the kind of MMORPG that I would play, since that is clearly an untapped market. The most promising of my design attempts so far:
1. Most of an auto-balancing economy with a wide array of player activities
2. A lag-resistant fast-paced tactical combat system that relies heavily on player skill. (Progression is based on bragging rights maybe?)
3. A crafting system that is compatible with item damage, dismantling and customization.
Number 1 would solve the economy problem with a bit more work. Your post will be very useful in my attempt to finish this part.
Number 2 will help to keep the player base together, especially if I can get my city-state idea to work out.
Number 3 is just interesting.
Pay2Expand sounds like it should be a good way to handle funding.
Overall, this is looking doable. Still lots of work to do, though. Design is just the beginning, after all.