Played some multiplayer with some friends. Friend just started playing at level 5, I joined his game at level 39. Everything is scaled. In his game the enemies are level 5, in mine they are level 39. He gets his own loot, I get mine (instanced loot). Very cool! Also on the ship you get your own room that you can decorate, there are 4 rooms and each room is for each player in a game (can visit other players rooms)
a video just game out on power leveling people, 1 to 50 in an hour. you have to set the game mode to "coopetition" and let the higher level kill the boss. then the loot and xp is scaled to them.