Sounds very interesting. I could see how as something expands out to more targets, it would have less effect as it gets wider. I have a few items since I am not sure on the mechanics.
First, would this make it more difficult on AOE use since they are putting out less damage with higher number of targets? In other words, we use to be able to take X amount of targets really fast (higher damage), but now we have aggro with 30 targets, does it take 3X as long? Are we in more danger? For taunt, would taunt be diluted so much that by 30 targets the aggro now is on the damagers?
Also, from the list above, 1 target and 10 targets have the same damage per target (assuming 2-8 would be the same). What happens with higher ranked mobs like AVs and GMs? Would they be one target counting for damage output still as the number of mobs around them shrinks?
Any thought on making AOEs radius dependent in that the closer to the center the higher the damage output? As mobs get further from the center the less the damage. This way you could have more mobs, but damage becomes less effective. I am guessing that the collisions of the mobs and their tight packing might prevent this from being used (like in the garbage bin days).