This may be slightly off-topic (and I of all people do not want to deter any attention from fixing spell damage which I consider to be the single biggest problem in the game right now), but frankly, scaling quests based on party size should not be happening at all. One of the reasons you form a group is because you are not able to successfully solo or two-man it. If adding new people only makes the quest more difficult then much of the reason to add new people is gone. When you have 5 people in a group you should be able to take any other player just because having someone extra around will make things easier. But if adding that person only makes the dungeon harder, then there is no room for below-average players (which are plenty common in pick-up-groups).
Alright, I have said my piece. The issue of dungeon scaling is nowhere near as important as fixing elite spell damage so I definitely prefer you focus on that. Still, if there were no dungeon scaling for party size some of these issues might never come up (and be easier to isolate when they do come up). That said, the spell damage problem creeps up even in party sizes of one, so clearly party scaling is not the only issue (if it is a cause of this particular issue at all).