Something like that is far from being ignored by MMORPGs.
Most just favor using some classic level/skill point based approach, because it's far easier to balance and control progression ("when being there, characters will have skill x, but not skill y").
Therefore most games skip something like that alltogether, or limit it to non-story/non-combat elements like crafting.
There are a few exceptions, as mentioned already:
- Ultima Online uses a similar system like the one you described.
- Mortal Online does so as well (don't quote me on that, might confuse the name).
- The Elder Scrolls Online (do I have to explain?).
- Possibly a few others...
However, I have to disagree with some of your pros/cons, because there are ways to limit/neutralize these without actually changing the mechanics:
- You can limit the total amount of skill points available/obtainable. Once some limit is reached, you'd have to "unlearn" something to improve further. Skyrim's initial release hasn't had unlimited skill points/levels for example.
- You can further limit the overall set of skills available (e.g. not everyone is able to cast spells). This is something The Elder Scrolls Online will use for their class skills (stats and other skills aren't limited by class though).