Strongly agree on almost everything with the OP, it would be much more immersive. Waypoint TP is very gamey and breaks the suspension of disbelief. However, I'm mostly against random encounters - they're more annoying than anything.
I would like it if they broke the map up into separate regional chunks, and we travelled between them on the world map. It would get rid of the whole "why is the goblin camp a 2-minute walk from the druid grove?" thing.
Also this, very much so. It's just so unbelievable when enemy factions are practically sitting on top of each other.
