I tried to post this in the board, but got disconnected. It is pretty long, so I apologize in advance.
I played through the first 200 levels as a cleric, and I have some observations so far. Keep in mind that I've only played a cleric, and it's only been about a week. I have been MUDding since about '92 though, so I have some perspective.
First, levelling is terribly uneven. It's pretty hard to level when you're a new character, and it seems to only get easier as you get to higher levels. I think it should probably be the other way around, if it's uneven at all. I think there are several reasons for the irregularity: The first reason is that XP gain is based (mostly) on level difference, and level difference is more meaningful at lower levels. That is to say, if you're level 5 and going after a level 15 mob, it's going to be a much tougher fight than if you're 155 going after a level 165 mob. The second reason is that damage spells (at least the cleric ones) don't scale. A spell seems to do a set amount of damage, no matter what level the caster is. Perhaps introducing a level-based multiplier would help, so that an early spell might do (base dmg * (1 + ((3*level)/100))), while a later spell (with much higher base damage) might do (base dmg * (0.85 + ((0.25*level)/100))) damage. For example, lightning bolt might do (7d7 * 2.8) damage at level 60, while ray of truth might do (20d100 * 1.15) at level 150. (I haven't looked at the code, so I have no idea what the current damage formulas actually look like.) Also, healing should probably be proportional to your/your target's max hp, rather than a set number. You should never be able to heal more than, say, 75% of your max hp with one spell though, so lowbies can't uber heal high-level players. The third reason I think levelling is uneven is that overall character power level is very jumpy, in that it's more a set of leaps than a smooth curve. When I got demonfire and ray of truth, my power VASTLY increased all at once, and when I got superior healing, it was suddenly worth casting a healing spell in combat (it wasn't worth it at all before then). Spell scaling would help with this problem too, as it would definitely smooth out the curve.
Secondly, equipment seems to be all but meaningless for a caster. I don't think +hit or +dmg affect them at all, and it seems to be the most prevalent stat added to equipment. Meanwhile you reach your base stat cap very quickly, so dumping more int or wis onto gear wouldn't help. Even +mana is just a drop in a bucket. Maybe allowing +hit to increase the chance of success for proc effects (like curse, poison, and blindness) would help a bit, but it'd take more than that (especially since those effects barely affect combat). Maybe introducing a +spell stat that could be added to equipment which would directly boost the effectiveness of damage and healing spells would work, but it'd require a massive edit of the item files to throw that stat on some old items, and rebudgeting might annoy some non-casters whose equipment suddenly got worse for them. I'm just spitballing; I don't have a really good solution to propose.
Thirdly, spell failure needs to be reworked. I can understand that there should be a chance that your uber-nuke could fail in combat, or even that your heal might fail in combat. What I don't get is why create food needs to fail eight times in a row, or any other spell that can't be cast in combat for that matter. All that does is annoy the player and take time; it doesn't affect game balance at all. What I propose is that out-of-combat spells be practicable up to 100%, while combat spells (including heals) be practicable up to 50% as they are now, but max out at 90% or 95%. There should always be some chance of failure in combat. The spell failure percentage doesn't seem to represent the chance that a spell will actually fail, either. At 50%, the chance for 6 failures in a row is 1.5625%, while eight is less than 0.4%. I've only been playing a few days, and I've gotten eight in a row several times and six many times. I haven't done hard data crunching though, so this could be more perception than reality. I'd be happy to whip up some scripts to test this more thoroughly, if you'd like.
Fourth, the help files need some help. :) There's no help that explains what stats (str, int, etc...) do, except in passing (like help train). Some other help files are outdated or inaccurate, such as the help file for map (the command doesn't exist anymore), recall (the locations are different), ray of truth (it has nothing to do with alignment, thank goodness), and some others. It would be nice to see some hard numbers and game mechanics in the help files too (especially about stances, since they take so much time), but I can understand why you might not want to give too much of a peek behind the curtain. There's also very sparse information on rerolling, and I'd love to see a lot more information about exactly what you keep and what you lose. Also what exactly an ancient is and does, what skills/spells they have, etc... As far as I knew until a couple of days ago, going Ancient was essentially retirement.
Fifth, passive regeneration (of hp/ma/mv) should probably be significantly increased. I actually spent creation points on meditation, and it would take many, many hours to fill my mana completely by sleeping anywhere other than the pool. Regen should probably be proportional to your max, and spell costs should go up as well. 50 mana to heal ~3000 hp seems a bit unbalanced to begin with.
Lastly, if I understand correctly, the entire point of the first three tiers of your character's life is to grind QP and stance points. It seems entirely irrelevant what classes you've played before, what skills you've had, or what gear you've gotten (perhaps other than imm-granted gear). That seems... wasteful, I suppose. It seems like the flavor of your experience should carry through in some way, so that every incarnation is meaningful. Maybe allow a few skills/spells to carry over from class to class (perhaps costing creation points). Again, this is an area where I don't have as many suggestions as I should. Still, there must be some way for flavor to carry over without tipping the balance.
TL;DR - MUD is fun, but there are some things that could make it better.