That is a good point. More characters squeezed into the same play time = less attention to each individual character.
About this, in all of the realms I've played in it seems like <10% of the players participate amongst themselves while everyone else is locked out or too apathetic to join in. I doubt things could get any worse than the current situation.
I'd place the blame mainly on realm size and the inability of knights and Lords to meaningfully participate in gameplay. Currently only council members and Dukes have any real power, and council members are severely limited due to entire Islands being consolidated by half a dozen super realms. Furthermore it's hard to feel any sort of connection to these uber realms because they're so big. The difference between a large realm and a small realm in this way is like the difference between a Walmart and a small, local business.
I think the proposal in the opening post is a good idea if only to break up these mega realms into smaller realms, as that would make more council positions available and allow for more individual participation.
