If you've spent much time at all adventuring around Azeroth, you understand the concept of instancing - non-shared areas of the world that you will only see your own party members in.  Each has its own advantages - non-instanced parts of the world can make you feel as though you're within a bustling world full of numerous players with whom you can interact.  Alternately, instanced areas can provide experiences that are always available to everyone, regardless of how many players may wish to  to kill the monsters within.   There doesn't seem to be any hard and fast rule about what is or is not instanced in World of Warcraft.  For example, Onyxia lurks inside an instance of her own, while the four green dragons - encounters that involve killing a similar number of monsters of similar difficulty to Onyxia - are not instanced.  Certainly this makes each of the encounters have a different challenge.

But what do you think about instancing?  Is it overdone, underdone, or just right in World of Warcraft?  Do you prefer running through a private instance encounter, or racing against others to achieve the same goals?