I think the idea stems from a desire to create a sense of uniqueness amongst players.
But that has a historical anchor, i.e. there only being one Scarab Lord on a server, or only seeing a few players with Deathcharger’s Reins or Thunderfury or Quel’serrar or Rank 14 PvP.
It helped create a sense of community in which players recognized others for their uniqueness.
That design worked really well in an isolated server community of a handful thousand players or so.
There’d be a few who had the plans to make Arcanite Reaper, so you had to know who that was. Likewise if you wanted the Crusader enchant, which was quite rare, you had to know who had it on your server.
And that was the same with rare items. Maybe one or two players were so lucky as to get the Deathcharger’s Reins, so they stood out on the server and had some uniqueness and identity to them because of that.
Likewise with legendary items. Being so rare it was a very defining moment when someone was given them.
In that kind of community environment the extreme rarity of items and rewards makes a lot of sense, because it really helps foster the sense of playing in a community.
But that’s not where we are today.
Cross realm everything, cross faction and region-wide this and that.
There’s very little sense of community left – we’re basically all bunched together in a giant pool of public anonymity.
And in that environment the extreme rarity of items and rewards starts to feel detrimental to the enjoyment of the game, because it is meaningless to us if some complete stranger from another server and the opposite faction and a whole other language happens to have something extremely rare – because we have no connection to that person. There’s no sense of community outside of what we have in our own little friends list or social guild.
As a consequence the player focus is entirely zoomed in on our own acquisition of rewards.
In the old days it was cool if someone got something rare on your server, because you might know that person in one way or another. Today it’s only cool if you get something, because all those people hanging out in Dornogal are complete strangers, so you don’t care about what they have. You only care about what you have.
Therefore the rarity design in WoW is also out of whack, because it reflects a time in history that no longer exists.
The rarity of items and rewards should really be balanced around the individual player’s acquisition of them, and not a broader server community (which no longer exists).
We also see that with a lot of the modern reward systems, like the Seasonal rewards for completing goals pertaining to Mythic+ or Raiding or Delves or PvP. They’re balanced around what any individual player can reasonably hope to acquire – as is befitting of a Seasonal game design.
But Blizzard still holds onto some of the old rarity design with mounts and pets and other collectibles. I guess one reason is that it whips the collectors into action and makes them spend a silly amount of hours on the game. And another reason is probably Blizzard’s own reluctance to change things in the game in general, often erring toward a very conservative design approach for WoW. And I suspect there’s also some lingering sense of wanting to preserve that old historical feeling of an MMORPG and the design that comes with it, even if it isn’t very reflective of the modern game today.
So it’ll probably stay as it is, though I wouldn’t say it’s a favorable design for the game anymore, or the people who play it.