I say this gingerly, but with great importance. I've been playing here for a while and love the server, but this is a very obvious problem.
Just because the hardware can support 7k players, doesn't mean the game can. There are just too many people in zones. Running around camps waiting for mobs to pop is not how the game was designed to be played. Vanilla WoW was about running through a zone and seeing mobs populating the area making it feel alive.
As Nostalrius is now, the zones are stuffed full of players running around instantly tagging mobs as they spawn as they struggle to complete kill or collection quests. It is aggravating and often leads players to log off. It also appears that as population ramps up the server shrinks the mob update information around your player, which means you can't see mobs farther than a dozen yards or so in front of you. This is how the hardware accommodates so many people so it's a double edged sword. More people can play, but you see less of the game around you.
Nostalrius is a victim of its own popularity. Its AWESOME that we have so many people interested in playing here. But prime time is almost unplayable in many zones. We don't need more respawns. We don't need better hardware. What we do need is people spread out more. The vanilla game world just wasn't designed to accommodate 7k+ people.
I'm hanging in and still playing because I really love this server so far, but I am definitely restricting my play time to the non prime time hours of 2am server until about 8am server time.
I'm really hoping that the devs come up with a solution to this problem (yes, I do believe that another server is the answer, not faster dynamic respawns) and that it becomes more like the vanilla experience I remember.