Nah, it was most likely sacrificed for the sake of low end PC's so more character models could appear around the world on screen altho like I edited into my OP, a way around this would have been to implement a graphical setting for low end pc's to tone down the amount of character models that appear on screen greatly reducing lag and improving performance.
The whole ps3 limitations argument is invalid because the orrigonal game was supposed to be released on ps3 also, the real reason the ps3 version was delayed was because they had plains to remake the game and the orrigonal game wasn't popular enough to bother with the ps3 release yet.
FFXIV was originally destined for release on PS3 as well as PC, but the PS3 version was postponed not because of graphical limitations but because the game was a flop.
My computer is garbage compared to ps3's capabilities and my pc ran 1.23 just fine, ARR flys threw wind in a gloriously lag free environment but I had plans to upgrade to a better computer for the ultimate experience, too bad for people who want this ultimate experience graphically it's just not possible anymore.