For the time being, let's handwave the tech requirements: Obviously, keeping track of 25 raiders - their health, mana pools, who they're targeting, what actions they've been taking - is much harder than just keeping track of a quartet of Survivors. Let's assume that whatever developer was making this game had the technological savvy and resources to make a game that was smart enough to adjust an encounter on the fly depending on the performance.
This "smart" AI boss knows how much HP and mana all the players in the dungeon have at all time. It tracks who is healing whom, it tracks how much damage the players are doing, and with what abilities they're using to do it. If this Smart Lord Marrowgar spikes a player who it has detected was healing one of the three tanks, it automatically lowers tank damage to compensate. If one of the healers dies, overall damage is reduced, and if a damage-dealing player is killed, the AI will make the boss take slightly more damage from all of the other players to make up for it.
In this way, even an attempt where things go wrong can be a successful kill. Instead of having dungeon difficulty represented by a series of steps where, once you pass a certain threshold of raid dungeon experience (and/or quality of equipment) you succeed, we'd get a more gradual slope of progression. For many, the boss fight would be easier - but let's not forget that there's a flip side here, too. Not only would the the AI weaken the boss's abilities to compensate for poor player performance, but it would also make the boss stronger when up against pros.
Is everybody alive, and do the healers still have most of their mana? Great, let's up the damage and add a nasty bleed effect to his melee strikes that will need to be healed through. Man, the raiders are sure doing a lot of damage - we'll spike the three characters topping the meter, and the boss will therefore start taking less damage.. Hell, a boss could be designed with some secret abilities that it wouldn't use unless facing a raid full of people at the top of their game.
In this way, you'd accomplish something along the lines of what Blizzard's WoW team is already trying to do with the Hard Modes for its raid bosses, only it would be a more organic and less fixed experience.