Well, zoning in EQ was the worst of both worlds. When you zone, you appear exactly where you were, just in a new zone. It meant that between every zone, there was always some sort of U curve to block line of sight. It worked for being the first game to do this, but it was really frustrating when you tried play in that area (like camping the zone in Crushbone).

I'm in the later camp. Make the world huge and immersive. If travel is a problem, allow for teleportation or mount-based travel. If we're out in a giant wasteland, I'd love to feel that sense of desolation - as long as I knew I could warp home when I was done. I think not having large zones due to gameplay concerns is a sour excuse, even though I see the concerns. It's hard to make an area jam-packed with adventure if it's empty and widespread. But then again, exploration is a lost flavor when the continent you're on rivals a Super Mario level in size.

I was just in Thousand Needles yesterday, staring at that contrasted border. I think the WoW developers just decided to not care about those kinds of concerns, for the same reason a lot of their immersion-breaking design choices exist. WoW is just a game, not meant to be taken seriously. Which, I suppose, is an okay alternative to taking yourself seriously and failing.