A obvious example of killing kayfabe is this.
This week, they announced the engagement of Rusev and Lana.
However, in storylines, Rusev and Lana have been broken up for months, with nothing showing on screen that they were getting back together.
No, we have only had Lana angry at Dolph Ziggler, and then no being on screen because of a wrist injury (I don't see how a wrist injury stops her standing in Dolph's corner or stops her showing fear towards Rusev. She could just slap Summer with her other hand). There has been no indication on-screen that Lana and Rusev are in love again, so this engagement has actually stopped the storyline dead (a lot will be glad, because the story was dying anyway).
But I think they should still have had Lana on-air, and have that Dolph and Summer are having an affair, Lana finds out, Dolph goes heel (which would match his Twitter handle) and, as a result, Rusev would go face. Rusev and Lana could then get engaged on-screen, and even have a mock wedding on--air, which is ruined by Dolph and Summer, to continue the feud.
In fact, I think Vince should have ordered Rusev and Lana to not get engaged until they are back together on-screen, to create some synergy with real life, and not have wasted six months on a story which now has no conclusion.
So, what now, when Lana comes back, is she back in Rusev's corner, or all over Dolph like a cheap **** again. How does she explain being back in the arms of someone who mistreated her last time, and has shown no indication on-air that he has changed his ways? Rusev and Lana went into business for themselves.
I mean, back in the day, you never questioned "Macho Man" and Elizabeth, who had been married and divorced, having a wedding at "Summerslam". No-one questioned how Triple H and Stephanie, who had divorced on-screen, and also had an aborted on-screen wedding, are suddenly married with three daughters.
Also, you have things where it is acknowledged on "Total Divas" that John Cena and Nikki Bella are lovers, yet there is not one mention ever on air about this. They never share air-time and it is treated like the relationship doesn't exist.
Also, how come Daniel Bryan or John Cena never confront their partners on-air, and ask them why they are being such bitches in the Divas Division. You have the Bellas as heels, and their beaus as faces.
It makes more sense when a TV actor gets engaged to a co-star, but they are in different relationships on-screen, because everyone can suspend belief, but the "half sports entertainment, half reality show" take WWE has done lately, and Vince's obsession with being known in Hollywood circles and getting their "approval" has made things confusing. It was middled further in the dying days of WCW when Vince Russo had "worked shoot" angles all the time, from Goldberg refusing on-air to take a move and do the job, to Hogan laying down to Jarrett because he played the "creative control" card.
I don't think it will kill wrestling, since everyone is now in it, and accept it somewhat, and yet wrestling is still around. But I think it makes things very confusing.