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I do wish the story could incorporate you and your party members into cutscenes more. It'd be fun to see each other in more than just beginning and ending scenes of dungeons/trials.
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Leveled with a Friend from Level 12-50 together. No issues here. Ofcouse, you have to disband party sometimes but it is not like you will do it every 10 minutes.
It is fine like it is.
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It's a limitation with the system in general. It's the same sort of situation for those of us that complain about not being able to queue at the same time the chocobo companion is summoned. Sloppy work but I doubt any sort of change will be made on the matter regarding stuff like MSQ party drops, at least not until that companion bird one is rectified.
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I honestly don't think it's an issue. Drop party for the instanced fights, regroup afterwards. Groups take one strong point (it forces the player to play reasonably well) and negates it. For those who can't do it at all, the echo kicks in after a few wipes.
In other MMOs, I had to have one char for solo and one to play with my friends, as to not outlevel them, which I found much worse.
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The number of instanced fights is pretty small and its part of the sacrifice they make narratively to make the story feel about your character in particular. The vast bulk of the levelling process is open world or requires groups to complete. You almost certainly will spend more time levelling in dungeons than in short instanced fights.
I can see why some people might be put off by it but they did have a reason for it. Further, changing it retrospectively now isn't something that would be as easy to do since they would have to screw around with scaling to maintain difficulty balance in instanced fights.
Honestly, its a shame its killing the experience for you but I don't see it changing. The MSQ is what it is. This game doesn't lack group content.