How do people even get immersed in MMO's?

I disagree. I enjoyed them both far more than WoW. Gear grind MMOs were the first implementation of "gaming as a service". MMO developers designed their games so that you wouldn't have time to play anything else. Gear grind MMOs were all-consuming

ESO is all about competiton. There are leader boards for raids as well as PvP. You play for the sake of being the best, not because you feel compelled to do it for better gear. The overland content is about immersing yourself in the rich story content. Non-leader board dungeons are about challenging yourself (they typically unlock cool skins and are punishingly difficult). Tying a carrot to a stick is a very shallow way of compelling commitment to a game.

Except neither of those games perfected their gameplay or content, so it ended up being less impressive than score boards in WoW.

You ended up with clusterf*cks with no real game design direction just turning into flailing contests.

Only WoW , Rift and FFXIV made any kinda competent end-game experience.

Challenge yourself is nonsense, you challenge yourself while gear grinding as well, there is no difference in that regard. "no gear" just made Guild Wars 2 dead after a month (relatively speaking)

Both GW2 and ESO are still extremely active (definitely among the most active MMOs at the moment).

And WoW is hardly a bastion of great gameplay and rich content. Most overland content is just fetch/kill quests while gameplay is slow-paced tab targetting. It was just the first great MMO and so it established a loyal following. Both GW2 and ESO have much richer quest content (especially ESO) and more active, skill-based combat.

I can't speak to GW2's endgame experience since I quit the game a while ago (although I'm sure it's doing fine considering the massive player base it still holds). But ESO has plenty to offer (6 raids, 32 dungeons, and 2 arenas, plus large-scale and battlegrounds PvP, with 2 raids and 2-4 dungeons being released annually).

And if you need gear grind to challenge yourself, you're obviously not playing the game because you enjoy it. Gear grind forces you to play. If you are having fun, then gear grind isn't necessary.