The original plan was for Lotro to be a pure PvE game. PvP within Lotro was a late addition late in the pre launch development cycle. PvP was done in a hurry on a very limited budget. In order to provide a 1-50 leveling experience given the extremely small amount of time left before launch was not viable. In theory, it could have happened by doubling the cost of the game. Hiring a bunch of developers as temporary employes, finding office space and computers. Turbine did not have that kind of money because they were an independent company already maxed on their line of credit with the bank.
Now, Turbine has 95 levels of content. The game is old. Warner Brothers has decided that they want to spend their dollars on products with high growth possibilities. I suspect all the Warner Brothers cash is being dumped into new games like Infinite Crisis.
Lotro and the other live titles are obviously in a downward spiral with revenue going down which has resulted in two rounds of layoffs at Turbine. Some of the people that know at Turbine that are really good that used to work on Lotro have been moved to new product development such as Infinite Crisis.
Unless stated otherwise, all content in this post is My Personal Opinion.