Personally, I'd like to see PvE & PvP servers removed entirely.
If you flag yourself for PvP, you enter a PvP xrealm zone.
If you flag yourself for PvE, you enter a PvE xrealm zone.
If you people mix groups, they continue playing in their own zone until their flag status drops.
No more of this 'oh, your AoE healing splashed onto someone that was flagged for whatever reason and now the whole !@#$ing worldboss group is flagged'.