But seriously, is this truly a "settings killer" [...]?
Free teleportation is a setting killer.
Imagine that characters can fly:
- how does the game deal with map boundaries? That's the biggest technical issue, since many virtual worlds are just floating blocks of polygons.
- No more inaccessible deep canyons, mountain tops, roofs and so on. No more access pass to the Winch, for example. So yes, it's a setting issue, as it easily breaks the current cycle of dangers, quests, the balance of difficulties, etc. Yes, it's doable, but it requires all the setting to be adapted to one game mechanic; a huge burden. Just think of how easy it would be to exit the DR today, if you could fly....
Now, teleportation. Same issues as above, plus you also ignore walls, closed doors, etc. Rich people don't sleep anymore, guild houses become open to public, and you can't even enjoy a minute of privacy in your bathroom because a friend of yours could pop up at any time to visit you.
Then the economy is transformed completely, since the most important factor of trade is distance and transport. I believe you said you're from the USA? Compare it (in proportions) to what happened to your country (and others) with the development of railway; to the use of certain sails, that allowed to cross the Atlantic ocean since the Renaissance; to the impact of aviation, of internet. Teleportation is the epitome of transport; with it, we wouldn't be discussing on the forum, but face to face sipping a cocktail near the Great Pyramid.
Then you change as well the urbanism, the army, the laws, the human behavior, the entire society, up to the notion of privacy for example.
Unless you choose to handle it the immature way superheroes comics do, keeping a nonsensical status quo, you either adapt the setting (huge work), or you put very serious restrictions on it, so that PlaneShift stays PlaneShift.
A table RPG can handle teleportation rather easily: the number of people using it is restricted at will by the GM, and then magic excuses are used to install some artificial scenario balance (anti-teleport, anti-anti-teleport, and so on). It's like a teleportation Cold War, but with no real impact since the game is centered on a few characters and the rest of the world is pretty much just a decorum.
In an online game, however, what is accessible to one should be accessible to all. We can already see that what is supposed to be extraordinary is common, and the supposed norm is rare. You can call it balance, but what we perceive of it is a transformed world. Already, nobody walks; given the opportunity, nobody will run either.
Again, serious restrictions needed.
As you can see, I do not use setting and balance to conclude that it's impossible, but as a starting point to tinker with what could be done. Besides, I only considered some obvious dangers; there are always sneaky ones.
Just for fun, what life would you live if you could teleport, for real? That of a tourist, thief, assassin, merchant, smuggler, reporter, other? Same question with "only you" then "you, like everybody else".