I think Kon's response is passionate and has cool overall transparency, props to that, not going to comment specifics on it (as most won't, Kazimir points out). Kazimir has good points that conquest system wasn't utilized for PVP, but travel also can limit that. It's also easy to metagame travel to avoid fighting, yet both things are easy to see while designing/changing by people who "wanted to fight".
I'll be stats guy and go down online list/activity checks.
Active Just-Write RPers
Zane, me (idc either way), Sofia, Sage, Rinni, Odin, Kurisa, Kon, Kazimir, Judith, Gene, Esperia, Azure, and Alisa don't care for fighting themselves. Valentine/sizeable portion of random people that hang around obviously don't care either. Every one of these writes nice in their own ways beside me, it doesn't make them "carebears" or "story RPers".
Past Active Just-Write RPers
Ordered kinda by activity: Mikajia, Masami, Venus, Kaiser, Hatsu, Akira, Nuala, Jan, Daiko, Yugo. Kerii, Caius, Lee, Xandra, Manzo, Yumi, Raymus, Natsumi, Ragnar, Etaoin and a bunch of people that may or may not be alts.
Note: Yugo is not a special case. Think back farther than ole Vice can, how many people do you think have been driven off because of the "cool fight RPers"?
Most of the "story RPers" also have multiple characters. Masami had an alt, Nuala had alts. Yugo making alts and not "focusing a strong char", is that not good for site activity?
Vs Past Active/Only "Fight RPers"
All were always less active than most of above: Steel, Ezekiel, Erebus, Noel, Tenshi. Shichiro and Kenzo just hang there as exceptions to activity but don't focus fighting. The others, when present, have interceded on convos to try to balance toward fighting. This is not "calling them out" or wrong of them, it's an easy to see census.
This is the real vocal minority, even if people reduce activity, systems and ideology remain behind. Compare the lists, how many "story RPers" voice chat (Judina doesn't right?) or were on Discord typing all the time? They don't need to be, they still drove site activity more than the vocal and cannibalistic "fight RPers".
PG isn't listed as they seem to like fighting but are "off-brand" for whatever reason, they stick around RPing either way like Tomoe.
Solution
Kon wants solutions and answers, that's subjective.
My opinion's more structured, yet I think Masami and others simply had more valuable potential input as staff than me. The same goes for crafting solutions. Like Kazimir said, people that are unenthused won't speak out and it's hard to do so publicly.
It's not that people want you to do more work Kon, I personally trust your balance and work, as others should. I'd wish that you brush off cute people that just want to maintain a status quo, for when they return from inactivity "MAYBE". Just-Write RPers don't need that as they'll follow the changes generally and don't need to be caught up.
Uncomplicated Changes
Most people don't want constant changes that they can't always follow regardless. Pushed participation in an event people don't have personal investment in makes people think they're missing out.
Second, Tertiary Magic
Additional magic on this site should be easy, Nullification/single magics shouldn't stack. I like unique event rewards like the Halloween magics/Hero Relics. I might not reach X/Z-rank till a reset, as most won't, but higher ranks having more should be encouraging.
Lore and Customs
Event magics and custom races shouldn't be a sole focus but that'd be something to be motivated for. Halloween-like magics being considered custom and permanent could also be good. The previous lore events like the cults and such aren't seen in the items/magic/feeling of the site new or glancing members see. The other slayers and the angel/demonic races don't interact.
Storyline Ranking, Balance
Tailoring Limited Magic to have different enhancements, or being able to create a custom enhancement can make a higher-rank character feel better.
Non-casters could upgrade their items and make them customs/get free customs ranking up that are lost on changing class. Non-casters can have some upcoming weapon mastery upgrades tied into their rank.
Overall, make it so the Masamis/Kurisas can do more storylines, even let them do storylines to get low-grade customs for lower-ranks in their guilds.
There should be a steady flow of items (culling the ones never bought too), now that a balance review system is in place. Staff has events and things to work on (Kon in particular, not the ones who leave inactive after getting in their input), yet the shop can just have members making the items. FTRP's always been about how widely diverse the shops are and people looking forward to additions from the outside. Development forum currently stymies interest as people already know what's coming generally (in dragon event's case - they're let-down), rather than steadying expectations for how things are coming along.
Tarots can be customized (there's JoJo Tarots, Persona, all sorts of media), and additional Tarots could be unlocked based off a member's rank. They'd go under an existing Tarot as an additional option. I still think higher Tarots should be stronger, it just means The Worlds can be customized (Esperia and Ika). All these customs (Tarots, multi-magic, not multi-storyline) in general should have an additional rank/jewels/work investment and don't combine.
Legendary Effect
X and Z-ranks are "legendary", but they're distant in the lore of the site. You can make lore-changing storylines, but they feel like something no one will see nor need to care about. Custom enhancements, Tarots, changing items on site to have a character's name/history/magical influence, or having a custom race (like Voidling except available to others) makes the character more memorable to drive engagement. No one joined RK to build it up with their character because while a law-keeping force is interesting, they don't have any real effect on lore.
Storyline Cooldown
In general, I think storyline cooldown is only good for things that shouldn't happen frequently like lore changes. People like Kurisa and Masami can accumulate too many jewels, yet jewel changes can stymie that. The balance itself around these ideas can fit the site due to enhancements/like-minded effects being successfully universal.
Centralize Storyline, Activity
Storylines and most things are released manageable. That's good for stability and balance, even though I think the site is well-balanced enough (props to Kon or whoever). People should be doing storylines more than neutral quests though.
As a side note, I suggest you only need to be active on one character and your alt can retain limiteds+get a free 2nd AC reward. The most active people have alts, it shouldn't be discouraging in any fashion for them to try and build up a second character. Second characters can be an insurance like how Masami joined RK where there's nobody.
"Fighting"
We've established no one needs fighting events here.
Why have battle mods or push fighting? Google "battle mod" roleplays and they're nowhere in the most active RP. It's an artificial mainly Forumotion thing to dominate a memberbase. Only really old sites had battle mods and they weren't serious.
Most sites don't push fighting anywhere close to FTRP. The members regulate themselves and if they don't allow things it doesn't affect either character. No reward systems, no bounties. Elsewhere, if members want to affect a site plot, they need to cooperate with the other members in that topic.
Why not? I joined and haven't seen a "fight RPer" fight since then. All those "fight RPers" are frightened of RPers that just write, trying to force to fight on their terms, even in the dragon NPC fights.