Thinking on it, the real issue with Diadem isn't the parties camping on top of each other. It's just not an interesting gameplay experience. It's equally as mindless as FATEs, and doing FATEs in a party rather than with a large group isn't any more thoughtful. There's no real exploration in Diadem, no elaborate spawning systems, no real objectives related to gear acquisition, or anything else. It's just hit the mobs until the ones you want to spawn actually spawn.

Moreover, I think you've actually opened this up to abuse since spawn rates will be adjusted when more than one party engages low ranking mobs. If a party decides to camp on top of you (and they will, because that's the mentality in the first place that prompted these changes), there's nothing you can do about it if you were there first besides go somewhere else. That's a terrible system, and I'm not idealistic enough to pretend it won't work out that way.