I think you lobbed me a softball, let me swing at it:
You continue to expand and patrol your territory, you blow out the big bases and take them over one by one. Hell you blow out the little bases and take them over one by one. You push everyone and everything out of your valley, and out of the mountains around it, and then you push down into the next valley on either side. You constrict the options of every player who enters your area and force them to go elsewhere for their resources, until, eventually, you control the entire map and nobody even dares to log on to your server because they know with certainty that you will hunt them down, kill them, and grief/compromise/claim their base.
Edited:
You've protected your supremacy and dominance of your territory and reduce the chances of getting killed in your own resource collection areas when you are out patrolling or grinding. You let that guy live pretty soon he's got a pipe shotgun and a revolver and he's running around in the dark in leather and sneaking up on you when you are trying to collect donations from your many admirers.
Every time I've been a nice guy and let the little bambi grow, they grow up to be a big mean S.O.B. that I then have to fight on equal footing. While there is a certain joy and challenge in that, it is better to crush them first, crush them fast, and crush them once and for all-- before they get big enough to take you on.
Oh I hear ya and you are definitely right. It probably will come back to haunt ya. But defintely more challenging and more long term fun. I mean think about it, if you pull off your grand plan (insert sinister muahahahahahaa!) what are you left with? A server you control completely, but you are by yourself because no one dares login? How much fun is that?