What people really want is "artificial stupidity" (and FEAR is a good example). If the enemy had true AI you'd just die, and in fact most unconstrained AI bots are pretty lethal (and boring). What makes for a good game is entertaining and plausible behavior that nevertheless lets you win against ridiculous odds, etc.

E.g. an enemy coming out of cover at a different position than when they last popped out is cool, but working out that coming out of cover is just a bad idea and waiting in ambush would be more realistic and smarter, but lead to stalemates.

Heck, you hardly ever see even vaguely decent morale implementations ("hey you just effortlessly killed 80% of my unit, so I'll, um, charge you!!!").

Again, in EverQuest some enemies would run away and get help. In World of Warcraft they just mindlessly attack until dead. EverQuest's AIs (lame as they were) were simply too deadly for a truly mainstream MMO.

About retreating behaviour, this was slightly the case with Mount&Blade Warband, where units would now and then flee when their moral was low, which could happen due several factors. Still I am unsure if historically anyone would be willing to charge alone against 100s of heavy cavalry units for a guy that pays ok.

Depending on the era, typically it was a full retreat and slaughter as soon as the shield wall broke. Not all the time, but that was just typically how it went.

Charging cavalry would be stupid. Soldiers knew no horse would challenge a bristling shield wall.

Many mobs in WoW absolutely DO run away, especially humans and murlocks.

You missed the important factor... "to get help".

The monster would run then find bigger monsters and all of them would come back to kill you. Often killing every low-level player in the area.

The parent didn't miss a thing. WoW does all of those things, and plenty more.

For a very incomplete example, you have sentry style mobs which run to activate an alarm and "bring help". You have mobs which run in fear and aggro any additional ones they path too near to.

Exactly, those are set mobs designed to fulfil that purpose, not how EQ did it.

Not all monsters in EQ fled - undead, for example, fought to the death. In EQ 'train' behavior was common when a fleeing monster or a pathing bug caused everything in the dungeon to chase after a player. That player would then run for a zone line to escape behind the safety of a loading screen.

In general most developers have noted that players hated this type of gameplay because it meant that one idiot could ruin an evening for 40+ other players in the dungeon because the 'train' would then clobber all the other players on the way back to their individual spawn points.

WoW also generally doesn't have zone lines that you can escape out of. The fleeing mechanic isn't something that's all that challenging to advanced players who know how to stun and slow. It actually makes encounters easier because the monsters stop doing damage at 20% health or whatever. Contemporary games have other ways of adding challenge.

You're right, I forgot. But it's much less organic and dangerous in general. In EQ for example enemy healers would help allies without actually joining the fight.

It currently depends on the player or game source: - Deathwing, a multiplayer cooperative game based in the WH40K universe have an AI problem, which makes the game utterly boring as enemies will do exactly the same each time. - AI bots have the additional value to fill less played games, expanding their lifetime value. - Finally, I can't dedicate 100+ hours to become good in a multiplayer game, so I'll rather smooth the experience combining human players and AI bots.