Both are different problems on either end of the spectrum. Low level players want the bar dropped to make life easier for them. While high lvl players want the cost of items to raise to make more money from them. In case you mised my first and main point. Neither of these issues significantly effects the ability to play SoD. Which I use as the measurement of the economies health.
Bringing up item costs is will make the lower level players unhappy. And adding high plat returns and moderating tradeskill drops will just add inflation. Though this would artificially bring up prices the value of the plat would diminish.
As to Vlos having a Robe of Flowing water. Yes he does have one and it took me over three months of trying to get my hands on the components (and quite a few party wipes) before I finally opted to buy it. However when I first was looking for the cloak it wasn't as mass spammed in the auction world as it is now. I don't see how this effects my argument. Since I already own one it's not like I have any interest in getting a second.
Just because players gripe doesn't mean the economy is defunct.