I came to the conclusion long ago that the only effective way to have effective non-grinding gameplay in an MMORPG is to base the game around competition between players. It is infeasible from a monetary perspective (development costs) and a practical standpoint to have interesting, custom-built content to fill years of gameplay.

What can break this barrier is interactions between actual people, which are far more interesting and variable than anything a developer can put together himself. The purpose of the game world should be to facilitate competition between players as best as possible.

Finally, a game should also be based around an activity that is inherently enjoyable without the existence of progression. For example, Team Fortress 2 is a lot of fun to play even though you're not "leveling up" or getting "epic equipment". World of Warcraft, by comparison, wouldn't addict anyone if there were no levels or equipment.

I can recall many games that have done either (or both) of these to some extent and were far more fun and interesting than any WoW clone:

1. Planetside. Not merely an MMOG first-person shooter, but one in which the primary content of the game consists of player combat. Shooting people in multiplayer games is fun, and doing it for territorial control with your friends in a persistent world is even moreso. Global Agenda looks like it might be bringing this concept back in 2010.

2. Shattered Galaxy. One of those games that got great review scores in every magazine and then disappeared off the map. A somewhat flawed but still very fun MMORTS, it was a blast to play even ignoring the progression aspect, and consisted entirely of player-vs-player team tactical combat with territorial control aspects. Incredibly addictive despite the pretty minimal progression system.

3. EVE Online. Failed miserably at the "base itself around fun activities" moniker, but based itself almost entirely around player-vs-player combat, empire-building, and market-based competition. To this day, it has set a bar for epic-scale player competition that no other game has gotten near. Basically all of the game's content was entirely player-generated: wars between player-run alliances over player-built space stations using player-built spaceships constructed using player-mined minerals.

In short, make it fun, and make it about competition between people, not between people and Orc NPCs.