Klepsacovic plays Pirates of the Burning Seas and is positively surprised that he can group in a meaningful way with a player 20 levels above him. Why does that work in some games, but not in others? A big part of the answer is that how much power you gain per level is completely arbitrary, and varies a lot from one game to the next.
In World of Warcraft the power gain per level is relatively large. There is easily a factor of 1,000 between for example the damage per second of a low-level character and that of a level-capped character. As a consequence grouping with somebody 20 levels above you results in an experience which is probably boring for one of the two players. If you fight mobs appropriate for the lower level character, the higher level character just one-shots them. If you fight mobs appropriate for the higher level character, the contribution of the lower level character to the fight is minimal. And with loot being strongly correlated with level, it would be hard to find a target that gives useful loot for both characters.
But that is a design decision, and not inherent to MMORPGs in general. It would be totally possible to make a MMORPG in which your power went up by only a very small amount every level, so that a max level character is only twice as powerful as a level 1 character. In such a game it would be much easier to make meaningful groups with players of widely differing levels. And you could even design it in a way that the loot would be useful for everybody: With characters having less difference in power level, there would be less of a need to have level restrictions on loot.
A game with a lesser difference in power between levels would also lead to zones remaining useable for longer. Monsters in one zone remain challenging for a wider level range, and their loot remains useful for longer too. Ideally you'd get rid of the strong level restrictions on quests, so that any group can find a suitable challenge for themselves, regardless of how many players are in the group, and what their level differences are. A player with 20 levels more might still *want* to group with somebody 20 levels lower, because the lower level player's contribution would still be significant enough for the higher level character to be able to tackle a more difficult challenge than if he would solo. And although it isn't my prime concern, obviously a game with less power difference between characters would also be automatically much better balanced in PvP.
I do think that getting more powerful with levels is an essential part of RPGs in general and MMORPGs in specific. But it is the perception of advancement that motivates players, while the actual size of the power gain is secondary. It is great to know that if you have trouble with some mob, you can level up and kick his ass later. But the extreme power gain many modern MMORPGs have per level leads to nobody even considering to go back and kick that mob's ass, because it is now so trivial to be not even fun any more, and the possible rewards are useless now. Everybody just fights his "level-appropriate" fights, and as a consequence in spite of all that power gain you don't even notice you are getting stronger! In many games you actually *feel* weaker after leveling up, because the designers made it harder at higher levels. You run Deadmines and Shadowfang Keep with relative ease around level 20, and when you return at level 85 the same dungeon is now much harder in it's level-appropriate for 85 version.
Thus I do think that diminishing the power gain per level would be generally a good idea for MMORPGs. I hope developers of future MMORPGs stop the ongoing power inflation and hand out power gains much more sparingly. I think that would result in better games. What do you think?