Are you really going to try to nitpick when your point is already flawed?
"I see more people when everyone is constrained to the ground and can't fly so everyone's condensed to the same elevation!". That's basically what you're claiming and if you can't see why that's already pretty odd to try to compare to a game where flight is well established, then I don't know what to say.
Along with the fact that Classic is a far smaller game than Retail is. So yeah, what a surprise, less places to go and only one altitude to do it at results in you seeing the player rather than them being 25 yards above you and not in your screen view.
If you played before Pathfinder was done, you would have also seen far more people around Retail, especially when Nazj and Mechagon hit.