I think you are overthinking it a little bit there
More areas loaded == more resources need to be stored in client PC's memory (and more can be rendered at one time, but that depends). Basically, if you see 100 players around you, it does not so much matter if they are all in one big area or in four smaller seamlessly linked together. The seamless might have a little overhead but the main problem is still
a. The amount of content rendered (client-side lag)
b. The amount of players in awareness range (network-side lag)
You can avoid the former by making simpler areas with more complicated terrain and use of rooms (limit visibility). The later is somehow beyond your control, at least if you plan a very open system. If there are 100 players around you, all 100 still have to receive your updates (position etc) and you have to receive their data as well. So it's up to your design to handle this. Some suggestions may include creating PvP zones with objectives spread all around that trigger at the same time according to population density, thus dividing the playerbase onto different physical spots (and thus different areas).
For the combat system, if you go for a fast paced combat then forgot system areas and most remote calls all together. What you want is responsiveness to a maximum degree which means you will have to do a lot of simulation on client and have good prediction algorithms to cope with the sync issues. Simple systems that do not require lots of data work best. We are using a system where we are doing all the calculations we can on client and predicting results right there. For example, if I hit a player and I can calculate the damage right on client (not just sending some generic HitPlayer() call to the server and waiting for result), I can then compare the damage with that player's health. If I see it will drop below zero, I can initiate the death sequence immediately, not waiting for the network. Sure, the opponent may have been healed by someone in the last fraction of second and if so, the server will send me a notice so that I can interrupt the death sequence (which basically means just blending in another animation). In maybe 5% of cases this may look a little weird, but in those remaining 95% it will give your combat that immediate reaction needed for it to feel "right".
Others will surely add some more details, I got to go to catch my bus
Cheers
if its not a trade secret how do you achieve the dynamic look - im trying several methods but havent found anything that hangs right yet , although i guess i could weld the layers of mesh together or something to make it flow better , i had thought there was some more cleverness that i might be missing