As one of those people for years this is basically what expansions meant to us..
Most of the group gear was as you assume worthless to us. That does not mean that the content itself wasn't relevant to us. We spent a HUGE amount of time in the group content of a new expansion..
-Augs (materia) were almost exclusively group content. We would quickly learn the best camps for the new named that dropped the augs we wanted and seek those camps out. Any gear that dropped we would just /shout it to anyone in the zone (also guild chat for alts/friends/family) or in the case of rarer items to the general chat channel as well.
-clickies. Some items would have unique clickable spells (usually buffs) and you would farm the items just for the clicky. Keep it in your bag. (one I used for YEARS, as in it was from 7+ expansions ago, was a clicky that provided the equivalent of a weakened protect for when you didn't have a "white mage" in the group)
-AA (alternate advancement points) Each expansion EQ would add to this system (originally introduced in the 4th expansion). It was a HUGE list abilities (most passive but each expansion we would usually gain a couple new abilities). There were "general" aa (everyone got them.. run speed, food duration, passive resistances to charm, stun, etc), archetype aa (healers got passive heal bonuses, faster rez cast, stronger esuna, etc), and class aa (lower benediction cooldown for a passive example or a group benediction on a 10 minute cooldown as a active example)
So was the GEAR relevant to us? No not really. Even the 1st tier or raid gear usually only equaled the previous expansion's top tier (so the Coil 3 gear would be = to the ALex(S) 1 gear. Mostly to fill in slots you didn't manage to get or for new apps) but there was still PLENTY of reason to spend far more time there than we do on any content XIV has released.
Eh depends how you mean. In raid content surely. Though my point would be why does it matter if the top raiders are in ilvl 150 gear and you are still in ilvl 90 gear if you are progressing and the gear is sufficient to do anything besides the raids past the ones immediately ahead of you.
That being said it was common practice among the top guilds (usually the #1 on each server) to host open raids. We would get our content on farm quickly and be down to like 2 raid nights a week. So we would take a random day (my guild did saturday) and host an open raid for the server. We would usually play alts (or play mains to help but "roll" for our alts) and take anyone who wanted to come through the easier raids of the current expansion.
Last expansion I participated in these in there were 4 tiers of raids (standard in EQ expansion) and we would run every raid in the 1st 2 + 1 of the tier 3 raids. The only thing that was reserved for the guild (well 1st dibs if anyone wanted) was the spell stones (EQ spells later on had 3 ranks.. merchant bought, group dropped, raid dropped) we had 1st dibs on the spells if we needed them as they directly helped our raids. Any loot was open roll for anyone present and you could only win 1 piece of loot a week.
To be clear we could play mains or alts because as a guild we no longer cleared anything but the top tier when we started open raids (usually a couple months into the expansion). Most of us played alts for the fun of it. We could still carry people pretty well. Few would play mains if we wiped due to too many inexperienced/undergeared players. We never let an event go unkilled during the open raids though.
Also as I mentioned above group content is MUCH more relevant to the "hugely segregated raiders of EQ" than it is to raiders in FFXIV who are only 1 step above the groupers... I personally haven't stepped foot in group content with those "more casual players" in what 2 months? Because it provides 0 benefit to me.