If this was pushed onto staff like Mistik to handle instead of a built in system, it would eventually be too much to moderate, realistically there are endless hover gods you run into playing this. Then there is the issue of not everybody having a PC that is good enough to record smoothly on so people most likely just wouldn't even be reported at all.
I agree that this would initially cut down on players somewhat, but only bad players. I also agree that there are some situations where hovering isn't intentional, I'm sure this mechanic would also kind of be abused to kamikaze enemies, but players would learn to avoid those situations. Good players might even return if they knew there was little to no hovering. This all doesn't matter though, because I don't really think they care about the quality of this game.