Ultimately cross server play was inevitable due to multiple servers declining; that's simply something that happens to MMOs. But I think Blizzard could have been a lot more proactive about ensuring that server identities didn't die, which is what wound up happening. For instance I used to always post in the WoW thread about taking forever to find groups at certain times of the day, or having to ask Etoilet to run with me. Cross server fixed that, I'm glad it did, but now servers are nothing more than hubs.
What if you got more rewards for doing dungeons with groups that had 4 people from your server. That alone would greatly increase the amount of people playing locally, and allow individual players to stand out again. I don't exaggerate when I say that at one point, I was familiar with every notable tank on my server. By Cata it was like "who cares" due to how much cross server play dominated things. And now the raid finder makes it even less important to find a decent guild, friends, etc.
We used to run alt raids on the weekends, just for fun. Few friends, some pugs, and lots of time. Now it seems pretty fucking tough to do that on most servers compared to just queing.