They really didn't. Moral changes just make PvP progression completely redundant. Why get i55, i70, i90, i100 when only i100 PvP matches i110 PvE? Easier to avoid redundant stats in PvP with PvP gear, but that's it.
I'm really starting to doubt you know what fairness is... It simply is not a fair contest to match up an i80 against an i130. Is it unfair that your i130 doesn't do anything? Sure, but that doesn't really effect the fairness of the match now, does it?
Duels have historically always been about fairness. You both pick a pistol, walk equal steps away, turn and shoot. The idea that a duel should be held between two people of vastly different skill sets (Jobs) and with different equipment (iLevel) is utterly absurd. That would be like one contestant wearing full body armor armed with an assault rifle "dueling" someone in the nude armed with a water pistol... It's an utterly absurd suggestion, and hiding behind the excuse that it would be fair because "I earned my assault rifle and body armor" is pathetic at best.
We've already had SEs attempt at gear progression based PvP. It's called Wolves' Den, and it is a complete and utter failure. One of the main reasons people were initially turned off PvP in this game (never to return) was because of the fairness of Wolves' Den matches. If you were outgeared it was very unlikely you'd win, and losing because your opponent grinding gear more simply isn't fun. Individual skill is the only thing that should matter in PvP, not "Who has the better gear/Job". You can cry about your gear being made "worthless" all you like, it doesn't change that fact.
Frontlines is doing perfectly fine, queues can take a bit but I manage to play regularly. Meanwhile Wolves' Den, where gear progression can play a part, is utterly dead. Which causes stagnation again?
I PvP for fun, not to obtain gear. Leave that PvE mentality in PvE please. If I wanted a gear treadmill I'd be in Coil instead.