This does not improve the situation much - if your password is weak it is still easy to recover using a dictionary attack - just compute hash(salt + hash(password + domain)) for common passwords until you find a match in your compromised password database. As long as the only secret is the users password and this password is weak, you are out of luck whatever you do.
On the other hand if your password is strong, then it is very unlikely that an attacker is able to recover it even from a plain unsalted MD5 hash. The only thing gained is protection of reused not-to-weak passwords in the case a system storing plain text passwords gets compromised.
Ah, I see your point. Whereas if people with unsecure passwords saw others logging into their accounts they might be more likely to change their habits. I stand corrected.
On the other hand if your password is strong, then it is very unlikely that an attacker is able to recover it even from a plain unsalted MD5 hash. The only thing gained is protection of reused not-to-weak passwords in the case a system storing plain text passwords gets compromised.