In my guild you can observe a small discussion about our raiding in Ulduar. Should we go 10-man or 25-man as the main option? This, but particularly a blue post one member re-posted on our guild forum (thanks Kai!) made me write this.
Personally I am all for 25-man raids. And I am happy to read the blue post, and their argumentation:
"I can even see the argument that 10 and 25 need to offer the same item level of gear. As I said, we haven't figured out a way to do it that won't kill 25-player guilds. Someone brought up the example of how 5-player or even solo versions that offered the same gear would trump everything else, and I think that logic is sensible. While the larger groups might be a preference, we think we still need some incentive to manage those larger groups or they will die -- not because players don't like them, but because efficiency is very important in games like this and efficiency can even trump fun. In this case we don't want it to."
This perspective on game design probably hold true even for many long-term guilds. The most fun aspects of the game are not automatically selected by the player, as one might think. It has to be designed. As stated above, if there were possibilities to get the same level of loot with a lower amount of people, the option for larger parties would probably be abandoned for the most part. Now, does this mean that people who say they enjoy the larger raids are only doing them since they are rewarded by better loot? Well, most likely not (I've heard that argument and I must say it is a really narrow sighted one). So what is the reason why people would not choose the option that they enjoy the most, i.e. larger raids, if the same reward could be gained by a smaller group or even individually? I'm sorry to say that I don't have a answer to that. But I am pretty convinced it is due to the interactional aspects of playing a game like this. Getting a 25-man raid going takes more effort than a 10-man. A 10-man more than a 5-man. In the ends I am sure most of us would take the shorter route, not because it is more fun, but because it is more convenient. You login whenever, you get your loot whenever. Fast, easy, and ready at hand. Question yourself why you do your questing all alone 95% of the time. Is it because it is more fun to do them by yourself than with a few friends? Right, I guessed not (of course it can be relaxing at times too).
To make an attempt to conclude this section, I would say that by providing a higher item level on larger raids, Blizzard make sure guilds will structure themselves to gain the loot AND doing it in a way that will be more fun than a 10, 5, or solo way of gaining the same.
As a final remark many state they play the game for the lore more than the loot (personally I play for the enjoyment of killing new content in an way that I enjoy the most, large raids (if possible)). The question is still, how do you want to experience the lore? With a larger number of guild mates, or with a few selected ones or even by yourself?