The problem with a spectator mod or such, is groups could use it to spy on enemy positions without getting in danger, far more quickly and effectively than in playing the game. It would be IMMEDIATELY abused, no way around it.
A more mild way would be to do it like Final Fantasy 11 did. It had various camera spots in the world that would give feedback to a website for players to get to see in game without being logged in. A sort of subscription recruitment tool, but if PS2 had some fixed spots to show off the occasional battle, it could help lure in new players and just be fun to watch a battle from the sidelines.
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