So, to summarize, at first they idealize a game based on territory control, where players would fight for resources and control of the city tools to make better equipment, where winning or losing a war would change everything because territory meant something.
And then, because they couldn’t possibly think griefers would grief, they got rid of the entirity of the stakes of this dynamic by cutting forced flagging, instead of implementing proper anti-grief mechanics (Karma system, bounty system, unflagged for factionless people, proper faction balance). Basically, they neutered the whole base concept of the game instead of improving on it (sounds like either lazy developing or a company pushing for a release).
Now, pvp has no meaning. People still do it because it’s fun, but after the 100th war, no one will want to do it anymore, because the fun is already over and the stakes are none. And open-world pvp is non-existing from the beginning because there is absolutely no point. You can’t fight for resources because of unflagging, you can’t control your territory.
So, the game is not fun for pvp players, and they want change, they want meaning. But pve players would rather lick a power socket than compromise and improve the game for pvp players. So, they ask for pvp servers, and again pve players don’t want that because they need pvp players to maintain the pointless dynamic of territory control. So they can’t enjoy the game as it currently is, they can’t change it and they can’t leave. Sounds like a inevitable path to a dying game.