As much fun as it is to play against AI, the AI in most games isn't very good. Also there's a tendency for AI actors to have less magical powers (and in general to be "lesser") than the players...I prefer a fair fight, and find much more challenge/reward in fighting against other players.
Interacting with players is an important part of online gaming. There are various ways we can interact - chatting, emoting (similar to chatting in many ways), trading, or, uh, fighting & stealing. I think it's silly to limit what is perhaps the most powerful and potent way that players can interact - with the combat system. In a good game, there's some stakes on the competition (maybe that's just the gambler in me speaking), so I like games where people can loot each other after they slay each other. DragonRealms and GemStone 3 (Which I believe was either the first or one of the first MMORPGs...it was on AOL & Prodigy before the interweb was popular) both allowed unlimited PKing (with consequences - if you PK'd without a good reason, then they'd lock you in the inescapable prison for a few days) and also graverobbing of all carried/equipped equipment/items.
Without the game punishing griefers, the players all formed an loose, unwritten alliance against graverobbers. Graverobbing was a death mark from the other players, and was pretty rare. (Although it did happen, very stealthily...) This kind of necessary alliance really could bring players together and form nice bonds.
Of course, trying each PvPer each time they PvP with a judge (GM) isn't the most resource friendly way of doing things...that being said, if PvP was allowed fully then the players would have to form a loose alliance with each other to slay anyone who would dare PK...
Sometimes you have to build a sandbox, and then let the users build a castle.
