It was failing during test weekend as well, maybe should have been a sign?
No, it's just that this particular problem is basically inherent in online games. The only solution is to order a lot of extra server capacity. And look what happened to games like Warhammer Online that went that route. Log on queues are one of the best solutions to the problem.
EDIT The crashing probably means they are being to generous in how many people they allow in at one time. or there could be a bottleneck. It's hard to say. Cryptic's server setup is different from most in how all of their games share chat and I think their log on server is shared by them as well