I agree with your experience, but I disagree with your conclusions re: cause and effect. Specifically:
* Penalizing players for dying for longer and longer periods of time
* Penalizing players for playing in groups
I suspect these were simply misguided design decisions aimed at making the game "challenging". Difficulty was entirely out of whack at launch across the entire game (yes, partly because the developers vastly underestimated the effect of the AH), and I suspect this was simply part of it.
* Limiting in-game communication systems severely
I have no way to prove it, but I'm almost certain this was a result of some bizarre political battle inside Blizzard. Battle.net 2.0 came out with Starcraft 2 with the same boneheaded decisions - no chat rooms, the RealID fiasco, etc. - and Diablo 3 simply inherited that mess. There HAVE to be people inside Blizzard who understand why players might find chat rooms valuable, but for some reason they never made themselves heard. I don't think this has much to do with the AH.
There have been public complaints from Blizzard employees about Battle.net. Community managers and developers both have stated that improvements to Battle.net are far harder to push through than changes to the games proper. Why exactly this is, I'm not sure. My guess would be that it's either seriously understaffed or drowning in bureaucracy.
I can see it being more difficult to modify, since it powers all Blizzard games. That also raises another option - it's a technical mess that no one wants to touch...
I'd bet it's drowning in bureaucracy for a reason — Battle.net is a common component in virtually everything the company creates, so any change to it will impact a lot of people's work in unforeseen ways.
Well, still (or perhaps even more so) - if they considered something like chat rooms to be as essential as many users feel, it would have been easier to implement earlier rather than later, when there are more products to support.
Then again, something like chat rooms could be implemented per game, minimizing impact on the entire battle.net system.
It just wasn't seen as a priority, or there wasn't the political will to push it through, or there's something else we don't know.
* Penalizing players for dying for longer and longer periods of time
* Penalizing players for playing in groups
I suspect these were simply misguided design decisions aimed at making the game "challenging". Difficulty was entirely out of whack at launch across the entire game (yes, partly because the developers vastly underestimated the effect of the AH), and I suspect this was simply part of it.
* Limiting in-game communication systems severely
I have no way to prove it, but I'm almost certain this was a result of some bizarre political battle inside Blizzard. Battle.net 2.0 came out with Starcraft 2 with the same boneheaded decisions - no chat rooms, the RealID fiasco, etc. - and Diablo 3 simply inherited that mess. There HAVE to be people inside Blizzard who understand why players might find chat rooms valuable, but for some reason they never made themselves heard. I don't think this has much to do with the AH.