As for WYL, what I'll say is this: a forum is often defined by its owner and moderators. Chapel poisoned the well early on at WYL by being just as arbitrary, cliquish, and restrictive as GAF at its worst, without the benefits of having a lot of regular traffic. Also, Chapel is an idiot, and that never helps. It's too bad, because WYL had a lot of initial thrust, and behind some different names it had people that rarely posted at forums outside GAF.
chapel's fine and I didn't see much overmoderation in my time there, and I was there longer than most.
The problem is that some of the early members really didn't provide a good atmosphere. Some were jerks and others were just... boring. That's what poisoned the well for the future. Then some of those left to make Cyniculture (which really did overmoderate, from what I saw, in an effort to make a it a "real" media site or whatever with the blog front page that never went anywhere*), but it was too late.
Red Scarlet and Wrath posting there at first made it pretty cool, but Red isn't one for forums and Wrath didn't like some of the people there so they left (I believe that's what happened.) It had little to do with the moderation IMO. I do concede they have too many mods though. Small forums should have two tops (including the one admin), mostly so they can just catch any spam or egregious posts.
I do agree that in general, small forums should have really lax rules. I've learned that's best.
*I've heard a couple times people want this place to do the same, and I have to advise against it. It's a waste of time for everyone involved and people will forget about it completely shortly after it's started. I know because I did the same thing for my forum before realizing the forum was worth focusing on, and I got rid of all that.