ZOS.
I am sure that you have your reasons for reducing xp for groups that are larger than two people. However, I have found over the few months of playing ESO that this is probably one of the biggest reasons that people do not group for a lot of content. Granted grouping isn't needed for 99.9% of the content in ESO, however reducing XP for medium sized groups does not promote grouping and socializing.
Socializing is a big part of MMO's. And the 2 person xp cutoff needs to be removed, or alleviated in some way.