No, you're pretty much doing it perfectly.
"We have player housing."
"Here's player housing."
"That sucks. We want true player housing."
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Reason was it wasn't finished. Besides spots where flight paths would take you over mountainous boundaries there was nothing up there. Silvermoon City, for instance, is nothing more than a cardboard cutout of a city, there's videos on it. They had to go over the entire world and fill in empty spots, fill in holes, put in trees and other doodads, and other work like that. They didn't want to have to go through that again, which is why Silvermoon and Azuremyst have never been updated and remain off on little islands of their own on the Outland server, not on the server with the rest of their continents.