Your example makes no sense. How would blizzard banning a wow account (I don't know the game particularly well, but let's just use this since you brought it up) be solved w/ Blockchain?
This is what people mean usually when they make this argument:
Blizzard can ban WoW accounts and take away your hard-earned in-game assets, and that makes people unhappy. Therefore, because capitalism, a competitor to Blizzard's WoW can arise whose killer feature is "we technologically commit to not being able to take away your assets because those assets are distributed through a decentralized blockchain."
Of course, it's pretty far-fetched. The "banned account had lots of assets" problem happens to a tiny minority of people compared to how many enjoy WoW because Wizards and Goblins or whatever, so to compete with WoW on the basis of "we can't take away your assets and they can" is not going to appeal to anyone. You have to also be better than WoW in other aspects that would make people want to migrate.
But the general idea is, "if part of your offering is 'virtual assets' you can use this technology to commit yourself to never being able to take those assets away". Hence ICOs.
Still nothing stopping WOW from simply ignoring those assets as part of account deletion process, rendering them worthless.