You will likely have to do both. First things first...
Who is the guild? By that, I mean what is your guild identity? Raiding guild? Social? Casual? Hardcore? Some mix of them all?
Thinking about what you want the guild to be will make a lot of difference in the answer. A casual/social guild probably won't have too much trouble getting recruits. A raiding guild...well, the guild I'm in has suffered a very similar fate this xpac and getting recruits is nearly impossible once you are far enough behind the progression curve. It will take a LOT of effort recruiting and persistence in trying to get some progression to save it.
You mention having 60 people online before and I'm not sure if you mean all at the same time or just active members who actually logon during the course of a week. Either way, it sounds like the guild has not restricted itself to just the raid core so unless that is part of the guild identity you would like to change, I see no reason to kick anyone unless you want to. If you are wanting to try to get current members involved again, make sure that the calendar reflects how active you are trying to be.
Having said all that, it looks like my guild may be officially dying, so I might not be the best person to give advice, lol.
"he doens't need healing, he doesn't need healing, he doesn't nee-WHAOSHIT!wtf was that man!". Please stop leaning on TDR. -Teng