The avatar giveth thee slightly away.
If your sole criteria for an MMO is that of bunching them all up in a town, or on some plain, or in a finite area of space, then this is indeed not it.
On the other side you got a fair selection of games calling themselves "Massively Multiplayer" without a persistent backdrop, and only very selectively allowing people to congregate. And then mostly as a way to spam chat channels and do emotes.
Planetside 1 & 2 should be the MMO archetype, by your definition. DAoC and Warhammer as well possibly. UO, yes. Oh yes. Star Wars Galaxies. At least you got out a bit. Still, a lot of them seem to go for instances with 8 or so players, and doing things that does not connect to a larger backdrop at all. You can technically meet and interact with people, but the game channels you into certain activities and smaller areas. There are potentially ways to meet and greet, but not as an "active" feature promoting anything meaningful. Like building a town in Star Wars Galaxies. That was a pretty meaningful way to do it.
As I have said, the backdrop for this game is persistent, it allows for multiuser activities at all times, and indeed gives you a rather massive amount of players that stays "online" at all times. Contact is overlapping, but limited by the P2P solution. So no more than the networking allows, but from a pool of thousands "active" all the same. The user base is massive, the "online" presence is massive, the world is super masssive, the real question is, how many times must the word massive be used? And how effectively do you think most games truly actually bunch up people like you say they must? It is not an experience I recall have been overused in MMORPGs, where instancing have been getting the upper hand of late. Raids in small groups. Teaming in small groups, with hubs abandoned in favour of instantaneous warp-me-fast-to-the-action shenanigans. Sure, I have played a little too many Cryptic offerings. They know how to instance the instanced instances.
What you might not observe so easily, is that in this game there is small bubbles interacting with other small bubbles, interacting with more of them, until they form an organism. You see, from the perspective of the user, it is quite finite. But from the perspective of the user group, it becomes more of an entanglement. Almost like cells form an entire body. Do you consider a Whale to not be massive, is it not made up of tiny bits interacting with each other, swimming in oceans seemingly forever? Can you honestly say that most MMORPGs with their shards scattered and isolated interact in such a meaningful way, to create a universe that is not separated by birth, not spread out like hidden gems? ( Shard = servers for you young people. )
The real question is how your singular definition of what an MMO actually is, can be used to define the nature of what you effectively can do in an MMO. If half of them use the congregation of players in a meaningful way, then I have not been playing as many as I should, to put it that way. Maybe you have. I have avoided some of them for sure. But by the merit of putting it all together, this game does a better job of it by the hybrid method, than most of them can pull off even by dedication. This is an entire Galaxy in one place, but you cannot meet all the inhabitants at once. It is still something somewhat more complex than some here will have it to be. THe perspective needs to be adjusted slightly. To that of the organism. Abandon thyself! float!