There's great roleplaying going on, but it's usually to be found in niches of players. In PS's case (since you don't have a general plotline) experience changes very much from player to player, depending on time-zone and on the players you contact with.
It's easy to find people to cooperate with you and it's easy to get sucked into light roleplays... But it's quite hard to find deep and complex plots unless you create them yourself, or know of other players to include you in it.
The community's certainly not dead. But interesting stuff happens only in if you've been lucky enough to get into it. Unless you haven't depleted all the quests yet (which are boring because you have to walk plenty, but interesting because they contain fun stories, even if most can't be used as RP material.)
