Suspension has to occur for the sake of gameplay. I don't believe for a second that, canonically, we're supposed to believe that places like Pandaria or the Broken Isles are anything but dwarved by the likes of Kalimdor and Eastern Kingdoms. Limiting the size of new continents for the sake of proper scaling, though, would seriously hinder those new locales. The only other option would be to dramatically increase the size and scope of the old world, which would both be a monumental waste of resources AND would make travel an absolute nightmare.
The problem with something like this is that it would be a disaster from a tech standpoint. One of the biggest reasons for WoW's success has been that it typically requires a comparatively tame rig to run. WoW can run on onboard graphics right now and adding a persistent world with no separation between worlds would wreak havoc on load times for all but the best SSDs.