In regards to instancing. Like everything else, I hope the bad effects of it won't force it to be rejected out of hand. I think it's important to actually examine what those problems were. For example, I think how instancing forced changes to loot, and scarcity of loot (IE it became less of a trophy/prize and more of a time card to punch letting you know you did work)? These bad aspects were some of the big problems with instancing that have never been addressed. However, I don't think those problems are so inherent that you can't design the raid/dungeon/instancing system to account for them, and so item scarcity and competition can be kept alive, but perhaps in a less aggressive nature than EQ. (Again, I don't think anyone wants P99 in a modern MMO.)
I'd really like a game, in fact, to merge the two. For example--Every raid mob would be default open world. However, at the start of each raid there'd be a switch that allowed you to enter an instance for that raid mob. The caveat being though that you only had a limited number of instance kills per cycle (Week or whatever)--and that number? Would besignificantlysmaller than the amount of bosses in game. So, if there are 6 current end game bosses, the number you can kill within an instance is3. The benefit to a system like this would be making sure there is still ahugeincentive for competition in order to maximize farming, but there is a stop gap so guilds can actually see/do content; at the cost of doing less of it. (And the number of instances you can do should remain stable, or only increase slightly, as more content gets added. Again, these instances should be used to see content for raids, and give guilds the means to do things even when everything is down but the point would be not to replace the over world.)
Combine that with other small details--like instanced loot would be BoP, while non-instanced loot would not have any soul binding--therefor creating a very valuable twink/exchange market if guilds can down the "prime" (open world) target. That economic incentive would also give a strong impetus to compete in the over world--because the items obtained from there could be traded to other guilds to fill in missing pieces of loot, or sold for twinking so said loot could be bought. Regardless, the point here is that you'd still have a very strong impetus to go out and do these mobs in the over world, and compete for them but if you fail, you're not left out in the cold--there is a certain amount of "consolation" content (It's just more restrictive than open world.)
Heck, with your game having weird planar intersections, it would even be easy to write into the lore! Instances would actually be mirror planes that collided with X or Y dungeon. Your guild needs to collect components to open them. However, loot that's gotten from there can only remain corporeal when worn (Hence the BoP) and mortal beings can only enter these unstable planes X number of times per week! (Hah)
I don't know, I know that's just some vague thoughts. But I think the main point I'd like to express is that--yes instancing had a lot of bad effects. But it also had good ones. On the same token, non-instanced content had a lot of bad effects as well, but also had good ones. Right now we only really have games that either do full bore instancing, or used to use full bore non-instance dungeons. Hopefully, Brad, you find a balance between the two and explore the one place no game really has (Except for some parts of EQ2)--which is a combination of instancing and community content that ensures the best aspects of both systems remain in your world (Best aspect of community content: Scarcity of loot, competition, investment in loot/characters. Best aspect of instancing: Content available, social activities for guilds not poop socking ect.)
Anyway, just my .02$.