@lnShaneI share this sentiment completely. I was really apprehensive about expressing it in a post before because the replies in this thread seemed supportive of the new system and I felt like my opinion would have been invalidated into obscurity.
I'm going to be honest, and please know my intention is purely constructive. When I first read this plan my immediate impression was: That on paper it looked good, but in practice It was going to be far more prohibitive than constructive.
I think players are going to be awfully disappointed when they realize that they can't create their own towns with their friends, and become discouraged when a former, more accessible system was now separated from them by a bunch of hoops to jump through. I certainly was, as it became immediately clear to me that my town which had been around since early V2 would no longer be possible due to these constraints which clashed with other obligations and interests. I know there were a lot of towns with a small nucleus of dedicated, loyal players with a strong sense of town pride who would be alienated by this new system.
Furthermore as I was aware of it, joining with other players and creating a town was one very appealing aspect of the server, and one that lead to considerable development of flavour for each nation. Not to mention the joy with which many players expressed their group’s story and character through their towns. While these new methods would not curtail this entirely, it would put a considerable damper on an aspect of the server which lent considerable creative “flair” to the community.
I think a more community-friendly alternative, which rewards town growth instead of demanding it would be more beneficial and well-received by the playerbase. A tax system should not prevent small towns from existing: they should be allowed to start small, but be incentivized to grow further given time: a system that positively encourages growth, instead of saddling financial burden. Furthermore, a more permitting type of system would not spell doom for towns with dedicated core players, who simply could not retain enough active players due to factors out of their control - such as the ebb and flow of server population. A possible approach would be something loosely based on a regressive tax incidence in which smaller towns pay a standard (but fairly surmountable) rate and large towns are rewarded with deductions proportionally based on their active size.
TL;DR: As of right now, It is in my view that a system like this with such hefty requirements skirts the line between incentive and constraint, falling further into the territory of the latter.
PS. I do like the PvP incentivization system very much!