It did not get nerfed, people did just out-gear it mostly, and I would tend to believe the developers agree with you on why they changed one and not the other.
People quit all the time on the original Steps of Faith because it was frustrating and boring to know at a certain point that it was impossible to win, yet have to wait until the dragon makes it all the way to the end so you can lose officially and try again. People generally did not quit on the Final Steps of Faith because loss was a wipe and an instant chance to try again - they complained some, sure, but generally stuck with people for several attempts like most trials.
I think the original Steps of Faith is also kind of similar to how we don't have full-party dungeons anymore after the end of the 2.0 story. Doing things really differently looks good on paper, because it brings variety to the game, but in the hands of MMO players who tend toward efficiency as a group, when "different" equates to a waste of time people avoid it. None of this has anything to do with difficulty, only speed and efficiency.



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