<mumble>I told myself I wasn't going to get involved in this...</mumble>

Ok, I am not entirely sure where this 400k inactive subscribers number comes from, but it doesn't sound that far-fetched, so I'm going to use it to play with some numbers quickly (Given that on release, there was still a substantial amount of interest, I wouldn't be surprised if there are indeed in the realm of 400k inactive accounts).

Disclaimer: This is not the absolutely best way to store this data, it is only meant to be a quick and dirty estimate of the space required.

Given 400k subscribers, let's see if we can't break down what data needs to be stored per account given a worst-case situation. Items can be referenced by a UID (or foreign key), but each account has some information that has to be stored uniquely to them, namely repair value and spiritbond for gear, quantity for items. Worst case, that means about 4Bytes per inventory space. Counting retainers, that's 2kB for inventory, per character.

Now, quest progression is also stored server side, and because they track progression, has to be stored as an integer (probably a short of some kind). Between Missions, Quests, and Achievements, that's about... potentially another 6.4kB (assuming around 400 quests, missions, and achievements) per character - yes I know this can be done more efficiently, but knowing nothing about the original servers (except that apparently they are terrible) I have to assume the worst. I'm going to be generous and toss out the piddling little stuff like: Armoire storage, current class, equipped gear flags, etc.

Add it all up and you're looking at about 8.4Kb per character, which is about 3.3GBytes of data. It could be much more, it could be much less, but I would wager it is within a margin of error of +-2GBytes. Hardly 40TBytes, but also not so insubstantial an amount as our OP has implied either.