The one game I can think of where iterative design significantly improved a game feature is League of Legends. No doubt, the entire concept is based off DotA Allstars, but the game had a closed alpha testing phase back in 2009 to gather feedback from real users and improve their game from there. Back in the early days, I remember the design and map layouts were simpler before the game introduced more refined and intricately built characters. Up till now, League of Legends is always updated and provided with latest patches, with most of them released based on the game community's constant feedback as well, from character design ideas to bugs and skillset mechanics. Despite seeming to be a ripoff from DotA Allstars, the game has also come a long way in creating a brand and following of its own in the ARTS/MOBA scene.