The essay is interesting, but a bit flawed. In his haste to condemn the varieties of online miscreants he places under the banner of \'d00d\' he oversimplifies things quite a bit, and I think a number of his suggestions would be ineffectual or even counterproductive! He more or less understands the nature of these folks, but misses the subtleties of their behavior and how it affects gameplay in an MMORPG.
A quick definition of terms would be a good start.
His #1 category of \'d00d\' appears to be an asocial power gamer, someone who engages in asocial or even antisocial behavior in his singleminded quest for advancement. A better term, borrowed from the pen and paper RPG world, would be \'munchkin.\' For them, the game is an elaborate power fantasy, a chance to be the strongest and most admired, and the essayist has a good grasp of this. (When the GM says \'This campaign will center on politics and intrigue in the courts of 17th century Italy\' a munchkin says \'OOH! OOH! I wanna be a NINJA!\')
This is different from the grief player, who is either bored or angry and decides to vent his frustration by ruining other people\'s good time. I once encountered a pair of kids on a UO server who were upset -- someone nice had given them a dog in the game, but they hadn\'t fed it properly and it went feral. Of course, a grief player heard the plight of these kids, and promptly killed their dog.

These types are fortunately rarer than the others, especially in games that have PK-capable player guards, or free PvP. Banning is best used only on the habitual grief player.
Then we have the twinker - generally a munchkin who has achieved his desired state of power and wealth, he promptly unbalances the game by generously giving valuable items to newbies. A player whose hard-built character gets passed by a first-day player wielding a +37 Sword of Maiming can blame a twinker. Newbies killed by hardcore PvP munchkins also have the twinker to blame - without him, newbies don\'t carry anything worth taking. (Grief players may PK a newbie, but that\'s a symptom of a different problem)
Twinkers are difficult to smack, since sharing is, um, nice. In a way, they aren\'t a social problem, but an economic one. They appear mostly after a breakdown of the economy - which happens because you have gold and items continually pouring into it with no drain. All this wealth flows downhill, into the pockets of the hoarder, who suddenly can\'t think of anything to do with it but give it away. I\'m short on ideas for this one, except build a viable economy somehow.

Back to the essay! He\'s right that attempting to curb antisocial behavior with strict rules and \'thought police\' is ineffective and damaging to the overall game. It\'s a lot like writing a constitution for a government - governments that force people to behave according to ideology are almost universally unpopular. The only way to make a government work is to build it with an eye to natural law. I.E., you /know/ there will be bad people who will try to abuse power, so you have to /plan/ for that in your system. An MMORPG is not too different, except that you can control the physics, economics, and other stuff ending in ics. It\'s when you get to thinking you can actively dictate human nature that you get into real trouble!
Essentially, the more rules you apply, the worse things get - grief players thrive in no-pvp games because the rules designed to stop naughty PKs also prevent good players from lynching the jerk who arrives at the wedding, strips naked and tells the bridesmaid \'1 H4V3 PH47 L3W7 N MY L01NCL0TH! W4N7 2 F33L?\'
Instead of trying to ban antisocial behavior after the fact, good game design can discourage it in an unobtrusive manner, removing much of the reward, and leaving the good players\' freedom intact. (Hopefully including their freedom to deal with antisocial jerks without waiting for an overtaxed staff to get around to it.)
The basic problem for MMORPGs lies in one of the common mechanisms of most computer-based RPGs -- the advancement system itself. Most CRPGS, and nearly all MMORPGS use a system whereby skills are improved through use. This differs from most pen & paper RPGS, but works out fairly well in CRPGS. It\'s a highly addictive stimulus+response=gain loop for one - both casinos and Space Invaders use this. The problem in using it for an MMORPG is that it rewards people, not for contributing anything useful to the gaming environment, but for their capacity to tolerate tedious and repetitive behavior. (!)
What this boils down to is that the optimal player under this system is the person with the most idle time on his hands. Usually someone around 13-17 years old who\'s been given his own computer, has no job and who doesn\'t get invited to parties or social gatherings. (LOL) An adult player who works hard and doesn\'t get a nice long summer vacation will never match the young unpopular kid for raw free time, and thus will find himself outpaced at every turn, which discourages him. This means the obnoxious kid will thrive, and everyone else will be left behind.
Not every game takes this system, mind you -- for example, an MMORPG called Underlight defeats this problem by replacing the standard click-for-skill system with a medieval-styled apprenticeship system. To build your skills, you train with a master, which means you must rely on the other players. If you\'ve been a jerk, you get nowhere. In addition, new skills are given by the staff to players who have done the most for the game, which encourages players to interact, roleplay, and cooperate. It works well and makes Underlight popular with the hardcore rp crowd, especially those with pen and paper backgrounds.
(Incidentally, this renders macros and bots useless for all but innocuous tasks.

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Similarly, bugs/exploits may be reduced in their severity with a good design. The Orwellian \'log everything everywhere\' route need not be taken, though it sounds helpful for things like resolving disputes.
One design principle that applies easily is that if you have a source of some commodity that you don\'t want people to use, placing a simple rule sanction on it is not as good as eliminating the value of that resource in the first place. In other words, poison the well and noone will drink from it.
An example: take the fairy-tale staple of \'changeling\' or \'faery gold\' and apply it to those exploiting munchkins. You deliberately add a \'bug\' whereby if Darkblood Blackmage the n00bk1LL4h puts 10 gold under a rock and his partner Bloodmage Blackshadow the Ub3r-1337 picks it up while Darkblood hits the tree with a herring, there will be 20 gold under the rock. Bloodmage says \'w00t!\' and they begin multiplying their money. HOWEVER, two or three days later they go to check their ph3t bank account and find that all their gold has turned into a big pile of dung. They say \'WTF\' and another player says \'Did you not read the words of the elders when you entered the world? They said that there are many paths to power and wealth, but only the fool chooses the short and easy road, heedless of its perils.\'
Of course, this particular example would require a lot of planning to close its loopholes, like passing the changeling gold to someone else, using it to buy expensive items from NPCS or other PCs, etc. (Though the possible solutions that come to mind open up some interesting side effects) The underlying concept can be implemented in a myriad of ways, though, and \'Cursed cheats\' are a good way to discourage people from using any bugs they might find, for fear that it might be a trick by the cruel and capricious gods.

The essayist\'s advocation of unlimited level/skill advancement is not a good idea, IMO. It\'s unnecessary and unrealistic, a leftover from D&D that causes nearly all the difficulties related to PvP combat and the like. To illustrate, i\'ll use the classic example of a D&D Dungeon Master and an Anti-D&D Dungeon Master:
Player d00d: \'I tell the peasants that I am the Dark Knight, Bloodshadow Deathdark the Oh-So-Menacing, and that they will give me all their gold and daughters or I will slay them with my +45 Vorpal Sword of Really Nasty Things.\'
First, the D&D DM\'s response: \'They refuse. *various rolls* You kill 63 of the level 1 peasants, the remainder flee into the hills never to be seen again.\'
Just replace the peasants with the essayist\'s \'mid-range average players\' and swap the Dark Knight for The General\'s little portrait entitled \'D00d Standing on Bridge\', and you see why unlimited advancement totally sVx0r5. You should never pin your game on the hope that players *won\'t* be mean to one another. Encouraging them to be nice is a good idea. Expecting them to be nice is a recipe for disaster.
Now in contrast, an anti-D&D DM: \'They refuse. Pressing you back by sheer force of numbers, they pin you down and begin loosening your armor. One of them produces a dagger and slips it under your breastplate and into your black heart. You are DEAD.\' (Insert evil grin)
It might be possible to separate combat with monsters from combat with PCs (though probably it would be too complex to be worthwhile) so that unlimited advancement would be possible in monster combat, but most of the advantages would be negligible in PvP, so that one skilled and well-equipped player would hesitate before fighting more than two unskilled poorly-equipped ones, and one-hit slaughters would be next to impossible.
Under such a system, the grief player at the wedding would be lynched, the guy on the bridge would be taken out, bands of (hopefully rp) highwaymen could operate successfully only in the wilderness, and paladins could gather together to track and eliminate said bands.
It wouldn\'t be Happy Care-Bear Land where nobody ever fought, tra-la!, but with PC and NPC guards, the towns and roads could be fairly safe. Bad players could do bad things, and more importantly, evil players could do evil things, but it would be reined in by the game design and by the fact that other players wouldn\'t have to put up with it.
The tone of the game then depends on the community as a whole, and if the game doesn\'t reward people for antisocial behavior and for simply having more free time than others, the quality of the community should remain relatively high. Most MMORPGS start out with a good community, as athelas noted, but the design of the game pushes the wrong way, and encourages the bad players, which leads to the cycle of rule sanctions & complaints which leads to players leaving in disgust, decimating the original community.
.. Um. Just a thought. LOL.