It is honestly my favorite part about playing MMORPGs.. Quests are amazing and so much fun. Leveling also allows you to greatly explore the world and discover all the really cool stuff about a game.
It definitely adds to the enjoyment of the game and does give the player a sense of achievement. As long as there isn't too much 'grinding' and the levelling up experience doesn't become too repetitive I don't see any problem with it.