I can imagine Diadem + Frontline merger that consists of instances with with PVPVE elements if/when the run goes bad.
If your group can't clear the regular PVE objectives (Boss) within a tight amount of time (essentially requiring a 'perfect run,' not screwing up Raid-wide CC or boss Defense+ mechanics that prolong the encounter), the objective resets (becoming more of a PVPVE), and is opened up to 8 players from each of the other GCs queue in.
They fight you in this new objective and the last team standing and/or satisfying PVPVE objectives wins the loot.
An NPC in each of the GC hubs could list active GC-Diadem runs, and makes a bubble text announcement (Like GATES in Gold Saucer) when there's a Diadem run that can be poached (Data Center-wide would be nice).
Gotta be some good loot in that diadem instance. Like, Scorpion Harness rare.
Wouldn't even have to be tied to GC factions,
*There would be the allowance timer just as there is for Diadem now, except poaching other players doesn't cost or require the allowance. Meaning you can do your personal diadem run, but afterwards if you want to do more you'll have to stalk the GC hub as a pirate/poacher
small anecdote:
A favorite moment of mine in FFXI was camping Enkelados, find him, he charms me (it's like 5-10 minute debuff iirc), Gil Seller waddles in, thinks he can poach Enkelados from me. Since I'm charmed though, I'm attacking him once he engages Enkelados. I kill him. Then I get Enkelados for myself. Wish i still had the screenshots. "So-and-so was defeated by Darius" was my forum sig (over a decade ago) for a long time.
Take that concept, then turn it into a PVP battle-ground with just enough PVE elements so players can avoid the PVP zerg, but if they screw up the PVE aspect, pain train comin'.
**Sorry just to expand one more time:
Regarding queue times, the problem isn't that queues are too long. The problem is we queue, period. People don't 'queue' for a PVP instance. PVP conflicts occur based upon player activity and opportunity. EVE Online, those big battles you see on youtube? They didn't start because two opposing factions had 8 or 24 players sitting around thinking, "Hmm I want to PVP against someone."
Just one individual or a small group do something slightly inconsequential and possibly totally unrelated to PVP (FFXIV equivalent: spawn an S rank Hunt), but a small skirmish could be triggered, and that skirmish can snowball into a server wide fight.
***tl;dr
Whether it's open-world or in an instance isn't really the issue, it's about how these PVP events are triggered. PVP could have triggers that a single player or group can orchestrate, not triggers based on how many folks happen to be 'in queue' at any one time.