"...but at what point does it make more sense for it to just be a single player game?"

I couldn't agree more with you, one of my biggest arguments and complaints about the design choices of a game like Star Trek Online as an example, is that the game they are creating would have made for a far better singleplayer game. They've already made all the fun choices for you: you're forced to be the Captain, you have to play with NPC pets, you only get xp from missions and not from kills. If that's the game they want to create then why didn't they just make it a singleplayer RPG with a deeper story and character interaction like a Mass Effect/KotOR?

Most true MMO players are going to expect the opposite from a Star Trek MMO. They'll want to choose the profession they have, they'll want to group with friends over NPC's, they'll want to explore giant worlds instead of the same small boxed sized instance zones with different skies and ground texture. It's a shame because I remember playing UO and EQ over 10 years ago and thinking how awesome MMO's were going to become in 10 years time, now here we are and the current designs are taking us backwards.