There is a video parody (in French) of the Council of Elrond scene from the Lord of the Ring movies, subtitled with a typical World of Warcraft chat. The raid group has looted The One Ring with great stats, and is now fighting who gets it. Boromir, the paladin, argues that this is pally loot, Gimli wants to disenchant it, and in the end it is decided to roll for it, and Frodo wins with a 100. Then they go on the next raid.
Hilarious interpretation, if you play WoW. It is funny because it is so true. Whatever the lore of a game, once it comes down to loot distribution, selfish considerations of players wanting to make their characters more powerful beat all lore. That doesn't hurt World of Warcraft much, because the lore isn't strong outside the series of Warcraft games. But if you play Star Wars Galaxies or the upcoming Lord of the Rings Online, the lore is supposed to carry much of the game.
Both of these licences are about a heroic struggle of a small group of people against an overwhelming evil. The need to work together in spite of very different characters creates the interest, and the tension between Han Solo and Princess Leia, or Gimli and Legolas. You can find them argueing about how to best fight the evil. Even Boromir doesn't want to "ninja loot" the One Ring, he wants to use it to defend Gondor, instead of throwing it into Mount Doom.
Real players in a MMORPG aren't that heroic. They aren't fighting a great evil, they are just trying to make it to whatever the level cap is and get epic loot. Thus the famous hunter weapon jokes. Even in a guild group I had recently to shout at a mage who wanted to roll need for the Heartblood Prayer Beads (note the +31 to healing, not to spell damage). The stories that get your heart racing in a MMORPG are often about other players behaving either very selfish or very generous. About who to invite to raids, and how to distribute the loot. The lore plays a very small role in all of that. And that is why Star Wars Galaxies never felt like Star Wars, and LotRO can be a great game, but can't possibly make you feel like a member of the Fellowship of the Ring.