The WoW dev team was pretty small and scrappy early on. Development started around 1999, so yeah it took about 4 years total.
What’s changed sense then:
Zone density
Vanilla zones were big but not very dense. Modern zones are tiny but jam-packed. Placing all of those NPCs, objects, and doodads takes a lot of time, and so crafting one tiny “modern” zone takes as much time as doing the same for 2-3 vanilla zones.
Zone verticality
Vanilla zones were relatively simple in topography, with most being relatively flat with mild rolling hills and the occasional cliff. Modern zones have much more prominent verticality, with caves, ledges, cracks, chasms, etc all over the place. In other words, sculpting the zones is more involved and takes more time than it did back in vanilla.
Ability to fly
Flying mounts didn’t exist in vanilla, which allowed Blizzard to take big shortcuts when sculpting both continents. Zone borders didn’t actually have to match up and fill all available space on the map for example, and the tops of the mountains weren’t player accessible which meant they didn’t have to be textured and sculpted. This meant that both continents were only around 60-75% player accessible, with large untextured voids sitting between zones. Modern zones on the other hand have to look good from all angles.
Uniqueness of art
Vanilla zones very heavily reused art assets (textures, models, music, etc) – for example, Elwynn, Loch Modern, and the Hinterlands all share some tree/shrub/rock assets between them. Zones with unique music were rare. Modern zones on the other hand make extensive use of new or partially-new art, which is very labor intensive.
All that said, I don’t think that current zones are all that more effective at their job than Vanilla’s were. Certainly they fix some problems that Vanilla zones have, but they also brought their own problems (like being tiny). I too would like an expansion that adds at least one EK-sized continent instead the usual tiny islands.
When I came on board during patch 1.5 all those leveling dungeons got plenty of traffic, even the ones out in the middle of nowhere. I wouldn’t say that they were a waste necessarily, and I wish new expansions had such great numbers and variety.