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Interesting, although it seems primarily concerned with protecting their own content (i.e., their own artwork, sound effects, quest stories and dialogue, etc). Character names wouldn't fall under copyright law anyway, and the only explicit reference to player content I can see is "transcripts of the chat rooms" (a compilation copyright, not necessarily extending to the contributions of individual users).
The Sony Online Entertainment's Terms of Service looks more relevent, at least to the OP's situation, as it seems to be claiming ownership over intentional submissions made directly to the company (rather than general content you create within the game).
The MMORPGs agreements are contracts. The OP's agreement is not. Furthermore the OP can't even prove that the contributors read the application requirements, let alone agreed to them.
I once wrote an area for a mud (back in 1994). Several years later they released their codebase, which included my area - and skimming through it, I noticed that the licence for the codebase stated that builders for that mud automatically agreed to give up their copyright. Until that time I'd never seen the licence, and certainly had no idea of what the conditions were. That is not a valid claim over my copyright. But how can the OP prove that his situation is any different?
You could just get them to grant you the nonexlusive rights to use their work. I'm not the owner of the Wheel of Time copyright, but that doesn't give Robert Jordan the right to make me throw away my copies of his books.
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