Having been in Arcaea for a very long time, I haven't found the former to be true, but the latter is definitely true. Arcaea's size makes it attractive for new nobles and the restored monarchy under Jenred established the King as a dictator who can say or do whatever he wants - and because Arcaea has had a lot of prizes to hand out to loyal nobles, it keeps its Dukes and richer lords fat and happy enough that this works. But things do flare up a few times a year.
I can assure you that it only appeared like Jenred could do whatever he wanted. In practice, what actually happened was Jenred spent a great deal of time figuring out what people wanted, molding them into thinking what he wanted, and then only publicly announcing things after he had gotten the buy-in of enough people to make it stick. Things he wasn't sure about he often asked for input on, and he very rarely actually pushed actively against what he knew the realm wanted, and only when he felt it was a critical issue...And because he did it so rarely, yes, he could get away with it most of the time.
That said, I can think of three serious issues off the top of my head where Jenred went after something and was foiled by other Arcaeans, and there was little he could do about it. As for the rewards...I won't deny that helped, but I think it had a lot more to do with taking (for the game) unusually bold stances, which garnered a lot of respect from different corners.
Arcaea doesn't have a lot of RP though. It's fun in the 'usually somebody to fight' sense and fun because it has a lot of history.
This, sadly, has been true for too many years. We had a
great core of roleplayers in 2008/early 2009, but we lost people, people had other interests, and it kinda fell by the wayside. I felt quite bad about that, as I felt I had a duty to try to encourage more roleplay, but none of my ideas panned out (prizes for ideas on campaigns, the Unicorn Guard, etc).
