I'd wager that most, if not all events in WoW's history that eventually grow to notorious or memorable status were due to direct interaction of one player to another, rather than one player, or a group of players, in a PvE encounter.
-the pvp raid on the funeral.
-that rogue who used to kill folks @ a choke point in one of the zones.
-the infamous 'moar dots' raid leader.
I'm sure I'm missing many others. I'll say that how people interact with each other is what draws folks to play MMO's to begin with, and often there's bad mixed in with the good. Steps that continually get taken to shield players from potentially bad behavior, you not only wind up presenting a game with few(er) strengths on its own, but you also wind up conditioning your playerbase, over time, to be increasingly intolerant of the behavior of others.
That's not meant to be a slight, it's just a pretty clear observation. Many of the acts that get called 'griefing' in this game are absolutely trivial compared to what players can do in other games. Or even what players used to be able to do in this games own history.
When you apply increased amounts of player to player isolation, you wind up weakening one of the biggest draws of the genre. And whether your game is sub based or not, that isn't a good place for an MMO to be in.