This article is borderline incoherent and written as WoW roleplay for some reason.

(this is from memory plus the less-incorrect looking sources I can find; I'm probably wrong about something but less wrong than the Wikipedia)

The corrupted blood effect is a relatively weak, short lived negative effect ("debuff") that appeared on one of the players in a group trying to fight Hakkar. This effect did a modest amount damage over time, lasted a few seconds, and would (and this is very rare for the time in the game) spread to nearby players, each player getting their own countdown starting from the time of infection.

While the debuff cured itself automatically after a few seconds, it didn't cause immunity, so if two or three players stood next to each other, they would re-infect each other over and over again.

The strategy to defeat Hakkar was to do this intentionally, preserving the short-lived disease until the team could use it against him -- there was no "panic" and nobody was confused about how the debuff worked -- understanding it was necessary to attempt the fight.

It was not possible to spread the disease by fast traveling.

What actually happened was an "exploit" (or clever strategy or cheating, whatever you want to call it): A player with a summonable pet could get their pet debuffed, then put away the pet -- freezing time for the pet preserving the contagious debuff. That player could then bring out the pet anytime in the fight they needed to have the debuff to use against Hakkar. Much easier than intentionally juggling the effect.

Nobody put away their pet in a panic to protect it not knowing how the debuff works, that's not a thing for several reasons.

Someone performing this exploit, by accident or experimentation, found out that the debuff was not restricted to portion of the game world where Hakkar is, nor restricted to the team members fighting him.

They then intentionally released debuffed pets in crowds, and more significantly, released the information about how to preserve and transmit the short-lived effect.

This is important: the only way the corrupted blood effect spreads (between in-game cities, for example) is by intentional action, its a griefing weapon, not a emergent property like a disease. Once it's out in public and you don't need to qualify for a high level raid group to see it, however, it's easy to transport and deploy.

The Wikipedia article makes it sound like "Azeroth" is a single virtual space that things can spread within; this is not the case, there are a hundred-odd (named) servers each with their own mostly identical world (only the players are different). Nothing can spread between these servers but information; they are totally independent.

The way the disease spread and persisted over time was memetic: while the condition would self-persist in a few virtual cities on a few servers on its own [1], Blizzard could fairly easily fix this, what was less simple to deal with was the masses of players intentionally preserving or re-acquiring from scratch the debuff and gifting it back to any crowd of players they could come across, on every server in parallel.

This was unusual because the game has few to no ways for players of the same side to grief/harm each other, so lots of players jumped on the opportunity to be the bad guys. Also, the non-participating players could not do anything to deter or stop the players intentionally repeatedly introducing the debuff -- this was fixed in the later, by-design, zombie plague which made the infected (temporarily) a third side hostile to and attackable by all other factions, even in otherwise enforced no-PvP zones.

There was no singular "Hard Reset" (though Blizzard may have experimented with unscheduled server reboots). A server reboot is disruptive to players mid-dungeon or mid-fight so they are usually scheduled in advance.

At no time was a player's, or the world's state or progress rolled back to before anything. Rolling world server reboots were used to apply patch 1.8 that altered the encounter to prevent the spread but that was the normal process for patching at the time.

[1] It may have been possible for two NPCs standing next to each other to bounce the debuff back and forth. Maybe it was just transit terminals where the game was constantly dropping in unsuspecting players, I don't remember. The primary vector was dense clumps of players and intentionally stored pets.