We see all the same groups in the group finder and we still get phased with all the other servers in the open world so a server merge won’t do anything for any of that. OCE is heavy on alliance so even on Frostmourne you’ll rarely run into some horde groups from Barthilas and that’s about it. The auction house is slower but there’s no problem with it for commonly traded items like crafting mats and raid consumables. Anybody serious about collecting rare battle pets and transmogs already has gold on Frostmourne.
So the only real problem with being on a low pop server is raiding.
We have 22 guilds at 8/8H. Any guild that can do 8/8H can do 3/8 Mythic ezpz but these guilds just don’t have the numbers to field a 20 person raid group. The release of Classic crippled the numbers of these guilds even further. The active player base who want to do raiding content is just too low for the amount of guilds. Don’t wait for Blizzard, they’re not going to do anything. Guild leaders need to consider merging or disbanding if they want to see progression in 8.3.