welcome to the community
think of a soul as being 'the character' and the body it occupies for a lifetime as the vessel the soul occupies for the duration of that particular reincarnation
there will ALWAYS be somebody who wants to be king - basic human ambition and/or greed will not change
incompetent people in positions of power will not fare well for long in this sandbox environment - they might survive for a while as other things within the game occupy the local population's time and effort, but with time an incompetent leader will either delegate to competent people, or be removed
the player population will be balanced with the 'intelligent' AI NPC's
in essence if there are fewer r/l players, the NPC's will breed more - as player pop grows, the NPC's breed less