Nice music

From FF7's Chocobo racing!
As to the actual issue with guard zone hugging and fighting from houses, the mechanics have always been there and folks have been doing it since 97.
Since not many ventures the lands in Fel anymore, folks looking for PvP action tend not to venture out either and just stick to places that there's guaranteed action, like the moongates and during events in Fel.
My view is that what's needed are incentives for folks to move out of GZs and houses. Some initial ideas:
Carrot method - Maybe if victor have not stepped into GZ/houses for at least 5 mins, whenever he kills someone, there's a chance that he/she gets a prize, say a cursed voucher to claim a random mini arty. Voucher has to be turned in to an NPC to claim the arty. Won't know what you get until you turn in the voucher. It can be traded and sold like powerscrolls.
Also, when the victor gets the voucher, he also get the "highlander quickening" effect similar to when you use a powerscroll. That way others that are nearby will know that he has gotten something and will have an incentive to get him.
I opt for it to give out a voucher instead of the artie to give it more resale value. Since it potentially can turn into a nice artie. Making it cursed him as will prevent the person from insuring it. Coupled with marking him as a voucher winner will make him an attractive target. Or make him sigil purple.
Stick method - Victor don't get any insurance money if he/she has stepped into a GZ or a house in the last 5 mins.
Workable? If 5 mins is too harsh, maybe 2 mins? If mini artie chance isn't attractive enough, how about using the blackrock traders and their list? Peerless regs, BOD hammers, mini-arties. Just throwing ideas out.