should SE delete characters that were never used

[Amiaze]

WoW made inactive character names available and gave the inactive character a free name change in case the player ever returned.

This is honestly their best solution. The main issue I see with deleting characters (whether it's to free up a name or just to free up server space for new players) is seasonal gear. If a seasonal event happens to fall below the level cutoff that would see you deleted for inactivity, then an inactive player wouldn't just lose their low-leveled character. They would also lose any seasonal gear, and most of that cannot be obtained again (barring that you pay for it via the Mogstation, which is a bit unfair).