Nah, subs are back up to over 10 million now.
Right after an expansion? Wow, surprised! The fact is that all of WoW's design choices since TBC haven't really had a huge impact on sub losses. Harder/Easier is pretty superficial in the grand scheme of things. I'd day fast content generation has a far, far bigger impact than difficulty (within reason) on sub retention. And I'm not really disagreeing with you about "easy"--on an individual level TBC and Vanilla were far easier than WoTLK/TBC. I think individual easy is good, with higher social difficulty being the limiting factor. IE put the emphasis of work on the officers/core group of the guild. And then let them bring whoever they want to fill the gaps--this formula works because it's essentially the basic structure of nearly every common social group, ever.
TBC and Vanilla were great because of this. You still needed a strong guild, and a great core of players to do the more difficult content. But there were large variances in the difficulty--so more than half your slots could go to weak players and that was a GOOD thing. It let you bring the dopey pot head that was average DPS, but made the guild laugh. It made it so you didn't have to be a complete dick about who your friends were just because you wanted to do content--but it also kept enough difficulty that you had to keep your eyes peeled for exceptional players and it still allowed guilds with great cores to excel faster. So, yeah, I don't think their constant raising of the difficulty is good...I don't think them lowering it is good either, though. I think the best solution is allowing enough wiggle room in encounters, by NOT scripting everything to death, to allow for stronger players to carry weaker ones. Weaker players get to see content, stronger players get to be little heroes, cliques get formed for great drama, and best of all--
a broader amount of players can play with their friends without these artificial dividing lines of difficulty.
Which leads me to my next point--I don't believe it's nostalgia making us cynical about MMO worlds. I think the biggest issue with MMO's today is developers who have God complexes. Every small facet of the game, both good and bad, is controlled. Oh--this epic sword isn't difficult enough to obtain, so we'll make you defeat boss X, which requires Y APM, at least 20 times before you can get it. This epic sword is too difficult to obtain. Lower the amount of precisely choreographed actions per minute required to obtain badges, and slightly tweak the amount of badges required to obtain, and make the pommel of the sword drop more often.
Everything from the loot, to the boss mechanics is controlled on the smallest of levels. Nothing in the world feels natural, or special, because everything has a puppet string attached. Sometimes simple and open is just...better. And that's not to say scripting, and molds/badges and LFD don't have their places, they most certainly do...All of these things are great in an MMO. But there comes a point where you can smother a world by pushing a good thing too far. Not every fight needs to require a guild to dance a psychotic ballet, not every piece of loot needs to come from precise placement in progression. Throw some curves, make it feel like there isn't a developer hand stuck up the content's ass. Let your developers flex their imaginations. Let PvP be a little imbalanced because some asshole camped for 99000 hours and got a lucky drop. Let some guild's main tank still wear his Dire Maul BP in Black Wing because his luck was shit. As long as these things are offset somewhat by the "control" systems, it's OKAY. The problem is when a developer makes any of these nuanced, "real" feeling frustrations be completely eliminated by artificial systems, you brush away any character your world has. It's left sterile, with no flaws to make it real, to make the "good" feel natural. (And I'm not saying it has to be ball breaking hard to make rewards feel "earned"...I'm talking about how a world feels more real when everything doesn't work like a god damn vending machine.)
I know this is pretty abstract stuff...But it's pretty simple. Being perfect doesn't give something character. Just the same as something being super-difficult and requiring huge time sinks doesn't give something character. There is a balance there that the developers are missing. I think a lot of their problems come from wanting to create a "perfect game", rather than a "good world"--the two things are very subtly different, but they are different. And the difference is not Theme Park Vs Sandbox, Sandboxes can be choked out with developer smothering too. It's more subtle than that...Games need that element of table top DM/Story teller back...That overriding desire to build a world of your own, and not a desire to control the characters in it. WoW is full of great game designers, I just don't think there are many great world builders left though.