This is exactly what happened with the recent WoW expansion, they listened to the hardcore, ruined whatever LFR has left and focused so much on raid content to appeal to the hardcore that they forgot about the rest of the game. The raiding was top notch in WoD, but everything else was pathetic.
Here's a gear comparison.
LFR (aka FFXIV's Normal):
Normal & Heroic(different colorations iirc):
There's a lot of reasons WoD lost over half of WoW's population, and that's one of them (several threads on their forums with the OP receiving severeal hundred votes to bring back normal sets into LFR.
This is how it was in MoP (LFR, and the rest. Can't remember the pre-WoD naming schemes for difficulties).
