objectively, the game was pretty boring... nearly every boss fight was tank and spank
Based on that remark, I get the feeling that you didn't raid in Vanilla.

I agree that fights were not as extravagant as they are today, but that's also partly due to all the new tech that Blizzard has added behind the scenes to allow for crazy mechanics.
Some fights also may have seen Tank-n-Spank simply because not all 40 people had a pivotal role in the encounter. For example... Majordomo. As a Rogue, I just fought the add that I was supposed to until it was time to fight Majordomo himself. However, there were people that needed to keep their CCs under control (there are 8 adds), and that was one of the biggest parts of the fight. If you had a fail mage, you would probably wipe. Mechanics got a bit more interesting in Blackwing Descent with fights like Chromaggus and his differing abilities (2 out of 4 possible choices) or Nefarian's class calls. I mean... what hunter didn't enjoy
carrying multiple ranged weapons?
there was no endgame progression unless you were in a 40-man raiding guild
That's true, but it relates to my next point...
and at its best, PvP amounted to either a mindless zerg in Hillsbrad or spending all weekend waiting to get into an AV game.
I think the mindless zerging in Hillsbrad and the early days of battlegrounds actually fostered a nice sense of community... or at least it did on my server. It was becoming involved with the people of your own faction and even the opposing faction that made the game so much fun in the beginning. Guilds were incredibly competitive... especially when it came to outdoor world bosses. I was actually part of a multi-guild group system (4 Alliance groups that did their own 40-mans), and other guilds hated us because if Kazzak or Azuregos spawned in the wee hours of the morning, we had a ridiculously large pool of people to pull from. People actually had level 1 toons positioned in Blasted Lands and Azshara just to look for the spawns.
The idea is that the sense of community and actually becoming e-friends with people could get you into a guild and consequently raids. The only problem that you had was that it was incredibly hard to gear up for raids. The dungeons that were supposed to assist you dropped incredibly poor gear and the tier gear wasn't really itemized any better (Rogue gear has dodge on it).
What's funny is that people complained about the troll instances being released in 4.1 instead of Firelands, and the same thing happened in Vanilla. People were already clearing or close to clearing Molten Core when Zul'Gurub came out (BWD was the next patch), but the difference was... the gear
was actually good in comparison to how ZA and ZG are mostly a stop-gap to T11 raiding content. Everyone wanted the Heart of Hakkar (including yours truly), and I was rocking the Fang of the Faceless along with my Perdition's Blade.
although, maybe I'm alone in that I don't think that designing instances to be completable in a reasonable time period amounts to dumbing them down.
I don't think there's a problem with making short instances either. A lot of people talk about how Blackrock Depths was fun, and it makes me wonder if there are just a lot of masochists that play WoW. I don't think a single run that I did of BRD can be described as fun... especially when you consider that you had to go in there to free Marshall Maxwell to do the Onyxia quest line, which almost always involved some idiot taking the escort quest before everyone turned in the prior quest. :|
But anyway... there's nothing wrong with short dungeons or giving people a choice to skip bosses.