I think an easy solution to the situation is to create more tier 0 sets. One for each spec tree for each class. Add a few 5-10 man dungeons within which certain bosses drop said items (maybe make a few drop off of Strat, Scholo, etc). The casual player can get a decent blue item in a few hours of gameplay.

That should solve the problem for a number of months. The casual players get more content and the hardcore gamer keeps what's important to them, the differentiation between casual and hardcore players based upon the color of their item names.