While I cant speak for the state of PvE servers back then, I can to the PvP servers we played on. Someone spammed foundations? Whack it with your steel sword and they were gone. No one spammed in T3 because the material took so long to farm in massive amounts, you didnt want to waste them. Top that off with gods that actually were gods, and things were not an issue. I recall lots of people asking for help dealing with exploiters and meshers. Not for foundation spam because we could deal with it. I think thats part of the issue now, too easy to farm T3 material, and too much time to clean it up.
Imagine if we had weapons that could take out T3 spam in 5-6 hits!