Cross teaming to overcome a third faction was encouraged in DAOC and wasn't against the rules. Albion typically dominated population and if you wanted to play Mid or Hib you had to cooperate cross team to overcome that. It certainly led to Albion whinging when it worked but divide and conquer is a time old political strategy too. That dynamic came out organically like Grim is talking about.Not sure what relevance either of those assumptions have (except that neither game had hardcoded factions?), but Darkfall was dead on arrival and I played on Siege Perilous before Trammel was even a twinkle in Gordon Walton's eye, so neither were of any consequence to me.
The latter isn't a given if there's comparable incentive to play either side, and a two-faction environment by definition prevents the inevitability of cross-teaming leading to kingmaking scenarios, which is arguably even more demoralizing to the losing team because they've been defeated by opponents who've conspired against the game's own rules.
Unless you are talking about having multiple accounts and 2 factions don't stop that so I'm guessing not.
Two factions almost never led to balanced servers and I've never seen an 'incentive to play either side' actually work. Instead what you see are people identifying servers where their preferred faction is having a population advantage and reinforcing it.