Think about it for a minute, if you nerfed the relative power of rare items, let's say by around 3 fold, they will still be worth making to the hardcore players, so they can still gain an advantage by putting more time into the game, it just won't be such a huge advantage that there can only be competition from other people who put the time into making rares.
I'm currently deciding if I should start playing DR again, I have around 7 other people, who are all 100% new to DR (they play a Legend of Mir private server) - and I might be able to get them to start playing, but the problem with DR is, there are NO new players, because we take one look at the game, and these are the questions asked:
1. What is the server population? (radical changes to the server/gameplay can and will bring more people back)
2. Are there enough low levels to party/pk (again, a population issue)
3. Is it feasible to become competitive at the end game? (answer is no, due to the massive lead people have in levels, which wouldn't be SO bad if rares didn't make them so much stronger).
I've been looking around the forums and it seems that the general feeling from the GM's is that a character wipe is not going to happen, I didn't find the reasoning on this but if the decision is made there is no point trying to persuade otherwise, this is why I started thinking of other ways to possibly bring some old players back.
At the end of the day, when you think about why people play DR, it's to get strong, and fight people, EVERYONE wants to be the strongest, but there are always a few individuals who have the time to get a huge lead on others in levels and rares.
I don't think anything more can/should be done about leveling, having a reset would bring everyone back together, but it wouldn't be long until the pure-hardcores would take a massive lead and things would already be back on track to how they are now - people quitting, and only playing during war/quest times.
So if you REALLY think about the core issue here, ignoring current server population, people won't rejoin DR because they have 0 chance of making it back to the top, people have way too much of a lead.
Nerfing all rares relatively, would not change the balance between rares, it would just reduce the negative impact they currently have on the game, I'm not saying nerf them until people won't make them, people will ALWAYS make them, everyone wants an edge, however small that is.
Imagine going up against someone with G30 worth of force (just hypothetical), you're not going to have a chance, which is kind of fair enough, they are stronger - that is that, but if the power was reduced by 3, he only has G10 worth on all items, he's still going to be much stronger than you, but it would reduce the impact, and allow casuals/newcomers to have a chance of being semi-competitive, whilst hardcores till retain the edge.