Any uncapped progression system will never really have diversity either, in the end.
Anyway, it is possible to have diversity in a capped system if the different abilities you have to choose between are actually powerful for entirely different reasons. If you have 5 merits and every single one of them is directly related to increasing your damage output, the choice isn't really a choice, but a calculation.
If you have some merits that increase damage output, and others that increase an entirely different aspect of your job than damage dealing, and you had to choose between this and additional damage dealing, then it comes down to actual choice based on what you want to do with your job.
I think the biggest issue with the current merits is simply that so many of them are really poorly thought through, and underpowered compared to other merits in the current state of the game. That's why there is so little diversity.
That being said, I'm definitely not against a very huge increase in the total amount of spendable merit points, I just don't think completely uncapping everything is necessary, and that it would just lead to a more boring game. I'd rather merits were actual choices, which requires SE to actually rebalance a lot of them.



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