. . . Which leads to the second conclusion:
2) If items are squished, raiding needs to be made more fun and less elitist.
This is not about casual players being unskilled n00bs. A lot of players who COULD perform well in current content do not want to, for reasons that go beyond real-life scheduling priorities. While the content itself may be enjoyable, as seen by the number of players protesting the possible removal of the ability to solo old raids, the social environment often is not. A lot of this has to do with the fact that most raiding guilds are focused on completing content instead of having fun. This sounds completely natural at first glance, but the reality is that raiding is this way because the game does not allow people to agree on what, exactly, is fun other than achieving the end goal of being able to loot the body of a raid boss.
What began as a simple inquiry, of how to squish items without upsetting people who enjoy soloing old raid content, leads to an examination of the very foundation of raiding itself.
This has a lot to do with the overall complexity of an encounter, and whether the actions the group must take can be easily understood and announced by a single entity (the raid leader, or a Deadly Boss Mods 3rd-party addon) or whether a raid group will perform best when most people are willing to take actions on their own initiative without needing directions from higher up. Another very important consideration is what are the consequences of being given the opportunity of a challenging situation but failing to succeed at it: does it wipe the raid group, or does it offer other players a further opportunity to recover from that mistake and even benefit? In real life, it's not always easy to identify what would have been the correct action in a scenario, because the consequences depend on being able to adapt to both good and bad situations and turn them to your advantage. You might normally try to avoid risk, but when the amount of risk you face suddenly increases it is just as important to know how to handle it. Unexpected levels of risk should not by themselves constitute a failure for the raid group.
In general, the connection to an easily recognized, larger group goal is very significant for the community values that will tend to evolve and stabilize. The most healthy situation will always be one where the goals of the group that someone directly interacts with has a clear relation to a larger group, of which the group one works with is a subset. The standards and defined benefit of the larger group form a way of evaluating the progress and goals of the immediate group and provide an outside, stable way of justifying any lack of progress or complications that may arise for the immediate group.
The scale of the larger group is not, itself, particularly important, as long as interaction with members of the larger group by the individual is completely optional in clear contrast with the accepted closer connection to the immediate group. The larger group must be neutral in relation to the smaller group with which the individual is associated, meaning that the smaller group's influence is strictly limited by the legitimate goals of other entities within the larger group at a level where no conflict has a priority high enough to require immediate action by any involved subsets of the larger group.
When benefit to the larger group becomes unclear, motivations have the potential to become distorted within the smaller group. For WoW in particular, faction PvP rivalry once defined a benefit to the faction from the acquisition of PvE rewards by the group, in the absence of any other clear benefit to the faction or other larger groups to which an individual belongs. (guild, roleplaying origin, faction, playerbase, national origin, etc.) In many cases the potential benefit would be of a specific accurate standard of achievement or the discouragement of inaccurate evaluation of achievements in general through the promotion of complex goals, but the actions of much of the playerbase indicate that in their experience, 'hardcore' raiding does not provide either of these two results.
Consequently, there exists a clear benefit from ensuring that raiding goals in WoW are harmonious ("river crab") to the commonly recognized goals of a larger group with which the individual has no direct connection, whether by influencing the goals of the group or by changing the recognition of how that larger group will benefit.