It might work if you made substantive changes to the loot system.
As the system works now you really need to be able to buy some stuff with certain classes, since otherwise you would get it far too late.
Take for example a cheap magic weapon to kill wisps, or a fine steel weapon for general killing. These would be beyond the ability of anyone to get where they would be useful.
One of the things which was a nice addition in WOW over EQ was the random loot part. After you killed enough mobs you would get so-so loot. Of course most people either had alts or tradeskills to buy better stuff at the AH, but it wasn't essential. With random loot it would make having it all nodrop possible.
Anyway, it's not my cup of tea. I rather like the idea of having a market and if anything would go the other way of having everything droppable. (as they did on the roleplaying server on live) It does make a problem with farmers, but I see the solution to that in putting key monsters in instances and possibly limiting the number of times the instance can be run if its all droppable. (Yeah I know some of you like the "competition" for spawns.)
All pretty moot really. Might as well just play a different game.
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