Sounds like a clear case of he said/she said, which is what I've believed all along. You really have to ask yourself, who do you believe? A Paragon insider, or NCsoft? I know that most people here will instantly go to the knee-jerk reaction of, "the Paragon Insider, of course!" But to be completely fair, you have to acknowledge that both have an agenda: the Paragon insider has recently lost their job thanks to NCsoft, and NCsoft is currently in the midst of trying to staunch a negative publicity campaign against them, striking at the heart of the matter.
The reason I bring that up is because I don't want anyone to think that I'm overly naive or gullible, willing to believe anything that anyone tells me. I'm well aware of the various politics at play here, and I've spent MANY long nights thinking VERY hard about the possibility that I'm being duped.
And in the end, based on the best information I have, I've decided that I believe the people I know at Paragon Studios over NCsoft. I've met them personally, they don't have as much at stake by simply staying silent (and indeed, some of them have put their reputations and quite possibly financial well-being at stake by coming forward, even as an anonymous source), I've heard very similar accounts from multiple people, they've historically proven to be honest and reliable, and not to put too fine a point on it, their version of events makes more sense to me than a publisher completely shutting down a studio like it did instead of making cuts and layoffs that could have restored it to profitability.