I understand the developer's wish to create content that the majority of users can go through smoothly, but the lack of challenge between dungeon and raid is more apparent as time goes on.

I would suggest to create a 4 man gauntlet series of dungeons. They could put some effort into the initial design, and more or less copy that design going forward. The appeal would be the difficulty rather than the design, maybe you go through a room with a horde of enemies, or just 3 bosses in quick succession, and the rewards, including exp, are all at the end of the duty. The rewards should be locked daily or weekly, as this will attract more competent players who will party with themselves, and will take them out of standard progression dungeons otherwise leaving new players to fend for themselves.