Depends on whether we are talking about a low complexity, text based MMORPG or the next WoW.
I know of a company local to me who have been developing one of the former and they are getting by with a relatively low spec rackmount. But they are having to strictly limit the user base and have still been in dev for about two years. Bandwidth and
server loads are a constant headache.
If you're talking about the latter then presumably it's a pretty big outfit and I'm sure there should be a dedicated team for server development. I think I read an article on the 'net by one of the Second Life developers about the problems they had encountered and that might be an interesting read for you.
Knew I'd seen it somewhere
gamasutra.com/resource_guide/20030916/rosedale_pfv.htm
I would have thought
blades vs
rackmount serverare the least of your worries.