The retainer system can work, they just have to make adjustments in 2.0; they've already stated they can't do it in 1.x.

These are some adjustment suggestions:

Interconnect the cities via a real auction house system that you can type in the item you're looking for without just having to search through the ward categories. Also interconnect retainers from personal housing and guild housing with this system as well. Add great customization options to personal market presentations.

Organizing the market wards:
Increase the size of the market wards, but only allow players to place retainers in stalls. Add system that creates market wards as needed, and make sure that players can easily choose the ward their retainer is in, so that if a player has a retainer in Tanner's ward 57, Tanner's ward 57 is highlighted and easily accessible for that player. Players should be encouraged to move their retainer to their personal housing so they can do their own storefront in their house.

Changes to retainers:
Currently retainers can only sell 10 items on the bazaar at one time. This protects and hurts the seller, but also does the same for the customer. Changes should be made that prevent people from flooding a market, but also to increase diversity among the items sold. Perhaps limiting players from making more than 5 stacks of an item on a retainer, but up to 20-30 bazaar items could alleviate this issue. So if a player had 6 elm canes and 4995 warped arrows then the player could post 5 elm canes and all 4995 arrows on his retainer. This prevents market flooding, but also allows sellers to craft for more level ranges with an increase in the bazaar cap.