Yes, IRC has warts, I didn't mean to declare it as the end of all things.
The point I was trying to make is that IRC would be a more sane starting point than XMPP. Even despite all the shortcomings you mentioned and some more that you didn't. And even despite it being a strictly centralized design that would require more server-side changes than XMPP to turn it into a distributed system.
I'll lean out of the window and even claim you could make a distributed IRCd backwards compatible to existing IRC clients, as far as the core business of presence/state, chat and group-chat are concerned.