Different walking speeds etc. are thought of and afaik there also were some improvements regarding this. However, having *paths* altering the terrain... that's a completely new idea - and a great one, I must add. I'm pretty sure that it's possible to add with (relatively) little effort.
I imagine it could work as following:
A terrain-map (like grassland) is split into sufficiently small fields (thinking of hex-fields of 1m edge length), all numbered.
Each field has a counter "times_used".
When a land-moving entity moves onto a field, the times_used gets incremented.
This should not be a big impact on CPU since the server knows the pos of the entity and can check the field used each 1 m the entity has moved.
It's also not a problem if it's not exact.
There's a standard-grass texture for fields that have 0 <= times_used <10, a stomped on grass texture for 10 <= times_used <50, a mud texture for between 50 and 100 etc.
I think we even have these textures already.
After an ingame-day (5 hours or 6 RL) the times_used counters of all terrain fields get decremented.
The biggest problem I see is the interface between map, textures and server, which is basically a CS thing.