Microtransactions only really work in a TRUELY side-grade driven environment, or heavily design/cosmetic driven environment.
For every item in an MMO that can be bought for a few dollars, that's one fewer notable quest or interesting crafting recipe that could have actually appeared in the game.
Ultimately, we're faced with two implementations: the first would be a little questline where I meet a goblin and, in the end, get a gobby hat; the second would be to make sure my PayPal account has $5 in it. I'll always prefer the former, where I play the game to accomplish things in the game.
I'm not opposed to what you're saying, but I think there's actually more to it than making sure there's a storyline preceding the gear.
I always felt A Crystalline Prophecy and its two companion "micro-expansions" were nothing more than micro-transactions that used a weak story as the flimsy pretext to convince you it wasn't a micro-transaction. An expansion shouldn't just be about collecting the one nice treasure at the end, it should be an extension to the world itself. Getting a reward for finishing a storyline is fine, but in its wake, that story should be opening up new places to explore, new activities to partake in, new characters to interact with, and so on.