I've read up a little on the concept of splitting the world into regions which in turn can each be run on a node within a cluster. However my game concept revolves less around zones but rather bubbles.
In short, a bubble is a region of space defined by a radius which dynamically expands and contracts depending on how many players are in close enough proximity.
For example if two players are over 1000KM apart and there is no one else that close to them, then those two players will be in their own bubbles. However once they come within 1000KM to each other, their bubbles connect, effectively creating a larger bubble.
In terms of the server space, one of those players is switched to the others instance. In practice it may be the case that a single server node could handle multiple bubbles, but for arguments sake we'll say that each bubble is run on a different server.
Secrecy may well be a big part of this game, so its important that when one player is close to another they aren't able to detect this by listening for connections to new instances.
My current thinking is that players would be grouped into proxy servers which in turn dynamically connect and disconnect from the bubbles therefore separating the client from this process.
The problem of course is latency. There is already latency in the communication itself, and I am concerned that this additional step of tunneling data like this may unnecessarily make it worse.
I would also love to find material to read on this type of instancing.