The Warcraft storyline is part of a great tradition of fantasy literature, and, as with any form of storytelling, the entire span of WoW lore involves a series of events and changes. Arthas wasn't always the Lich King, Illidan used to be able to wear shoes, and your character was once a little child, with no spells or epic weapons at all. All these things fit together in a single story universe, in which the progressive changes taking place in the story made the world what it is today.
But what is it today? Is Illidan now dead or alive? Is VanCleef dead or alive, for that matter? As a gaming environment, any boss you kill today has to be there for me to kill tomorrow. The WoW game world needs to remain basically unchangeable -- but over time this can stifle a roleplayer's sense of immersion in its narrative. To illustrate the impact this sort of immutability has on storytelling, let us take a page from a certain fantasy story you might have read, and see how it might work as a WoW raid instance.
Welcome to Mines of Moria! This raid instance will reset in 6 days, 10 hours and 41 minutes.
[Raidleader] [Gandalf]: Beware! There are older and fouler things than orcs in the deep places of the world. Follow my glowing staff!
[Raidleader] [Gandalf]: ... and um... get ready to pull that first group of orcs. Kill order is skull, x, circle... Gimli, can you offtank that cave troll?
<...a few hours pass killing trash mobs...>As you can see, even if some roleplayers make such a valiant effort, the necessities of the game mechanics can make roleplaying repeatable content such as instances difficult. The very fact that players can (and will) come back later and do the exact same thing can break their sense of linear story progression. Obviously terms like "pull" or "offtank" can help to break the roleplaying atmosphere too, but there are many ways of dealing with in-character and out-of-character communications separately.
[Raid] [Legolas]: A Balrog! A Balrog has come!
Gimli stares with wide eyes.
[Raid] [Gimli]: Durin's Bane!
[Raidleader] [Gandalf]: A Balrog! What an evil fortune. And I am already weary!... Over the bridge! Fly! This is a foe beyond any of you! I must hold the narrow way. Fly!
[Raid] [Frodo]: Gandalf!
Gandalf casts Mana Shield.
Gandalf casts Evocation.
[Raidleader] [Gandalf]: I am a servant of the Secret Fire, wielder of the flame of Anor. Go back to the shadow. The dark fire will not avail you, flame of Udun!
Balrog attacks with Flaming Red Sword.
Gandalf casts Presence of Mind.
Gandalf casts Pyroblast.
Balrog is afflicted with Temporary Setback.
[Raid] [Aragorn]: Elendil! I am with you, Gandalf!
[Raid] [Boromir]: Gondor!
[Raidleader] [Gandalf]: You... shall not... pass!
Gandalf casts Arcane Explosion.
The bridge collapses. With a terrible cry, Balrog falls forward and its shadow plunges down into the depths.
Balrog casts Curl Whip Around Wizard's Knees.
Gandalf is dragged into the abyss.
[Raidleader] [Gandalf]: Fly, you fools!
[Raidleader] [Aragorn]: Dammit. Okay everybody, let's come back next week. I will lead next time. Hopefully we'll all be able to kill the boss without collapsing the bridge. Man, I gotta have that [Flaming Red Sword]! Can somebody rez Gandalf please?
The fact is that there is no narrative continuity in WoW in any objective or absolute sense: nothing your character can do will actually change the game world in any significant way. Many roleplayers get disappointed when this becomes an inescapable reality, especially at the level cap. If they can't find any motivation for their characters to just kill the same bosses again and again without effect, they may quit roleplaying or quit the game altogether. They cannot claim to be saving the world anymore, because the next day they go back and those same evil monsters are still there. It would never happen in a story, so if it's happening for your character, then your character cannot be in a story -- it feels like "just a game."
With a little creativity and a little more flexibility, however, roleplayers needn't be stopped by this lack of objective continuity. In fact, we can get some inspiration from many stories in TV shows, pulp fiction and comic books, in which the villains never die either. These villains merely appear to die at one time, then later on reappear to fight the heroes again. The stories and spinoffs, subplots and retcons, all get so convoluted that all real continuity is lost -- and yet we enjoy them a great deal anyway! We care about the characters and their world more than the linear structure of their stories. If we view the WoW world in this more episodic, flexible manner, we can keep on raiding, getting phat loots, and enjoy every minute of it roleplaying as well.
In fact, even though there is no objective continuity, the game itself is based on a kind of "subjective continuity," which a roleplayer can leverage to his or her advantage. That's to say, the whole reason people play this game is to make their character and their friends' characters grow more powerful over time. As we do this, our relationships to the world change, and the enemies of old content effectively "die" as we leave them behind for newer and more challenging adversaries. You can't make VanCleef and his pirates disappear for good, for instance, but you can become so powerful that killing them again is utterly trivial and you have no real reason to do so anymore. Relative to you, he might as well be dead.
As you and your friends' characters advance in this way, you can act with one another as if the world itself has also changed. During the leveling process, you rarely return to old instances anyway, so it's easy to speak of them as if they're no longer filled with all the bloodthirsty monsters you killed there. You may encounter a low-level character asking you to run him through such a low-level instance, to which you may reply in the negative, "Son, are you delusional? I already killed VanCleef last year," or in the positive, "Gadzooks! VanCleef is alive? That rotten bastard must have feigned his death! Come, let us return to finish the job!"
As your character's relative power increases, and you no longer need to return to older content, you may feel that his or her long battles are beginning to have a real effect. By the time you reach Illidan, your character may act as though the rest of Azeroth and Outland is pretty safe -- or not! There are many different subjective approaches to your character's relationship with the unchanging world. As a roleplayer in WoW, you should not feel bound by many of the narrative limitations a book or movie might have, simply because you don't have the same narrative power they have. Feel free to explore and improvise, and when you find the right balance between subjective and objective continuity, you can feel happy roleplaying no matter what stage of the game you are in.