Well, I have suggested this in another server and the server owned has asked me for the details so, since I have already written them all, I post them here too (i.e, I'm not writting this all from scratch, but it's just a copy and paste). Here it goes:
This system is based on the supposition that if you fight other players of your same level, you will have a kill ratio of around 1 (not exactly, but more or less). Therefore, to calculate your level, the system takes into account two things: your kill ratio, and the average level of your victims compared to your own level. These two values would be hidden, they would exist only for the internal calculations, and wouldn't be visible to players.
If your kill ratio is about 1 and the average level of your victims is more or less the same as your own level, then your level is stable. If one of the two values (or both) gets high, then you are promoted to the next level. However, if the average level of your victims is well below your own level, then your level decreases, no matter how high your kill ratio is. This would mean that if you are a progamer with a high level, but you kill newbies over and over again, despite of your kill ratio being very high, your level will decrease anyway.
Each time your level goes up or down, these two values would be reseted, for example they would be set to one kill and one death (i.e. new kill ratio = 1), to prevent the old data from interfering with the new one.
This way, everyone would start from level 0, and then the skilled players would start going up to level 1, then level 2 etc. and the system would encourage players to fight others of their same level, so newbies would fight newbies and pros would fight pros.
There would be no limit in the number of levels, so if there were a super skilled progamer he might get level 100, 200 or whatever with no limit in the script.
There should be a command to show on the radar only the blips of the players that are of your same level and make them have a specific colour (something similar to the /gang radar command). This would help you to tell who you must kill and who you musn't.
However, as I said this system would be complex to script, because here come the two complications that have come to my mind (and who knows, maybe there are more):
1-Imagine that a skilled player starts with a new nick (or a player that is new here but has experience from other servers): he would have level 0, but he might start killing players of high levels. In this case, a high level player that is attacked by one of "low" level has three main possibilities: kill that "low" level player, be killed by him (and in both cases he gets the risk of his own level going down), or run from him and avoid the fight (which looks lame and is not fun). A solution to this problem may be allowing the high level players to kill the low level ones until a certain percentage of their total kills, and they would start decreasing their level only if they exceed that percentage.
2-Imagine a player with level 8 (for example), but in that moment there's nobody in the server with such high level, so the rest have levels from 0 to 5. In this case, the level system should be smart enough to allow the player with level 8 to kill players of lower levels without decreasing his own level. If there are many players with level 5 (the second highest level in this example), then the player with level 8 can kill only those players, but if there are only 1 or 2 players of level 5 and many with level 4, then the player with level 8 can kill them too.
Of course this requires complex scripts to calculate how many players of each level there are in that moment and depending on that, whether or not allow the high level players to kill others of lower levels. The problem of this, apart from the scripting time that it would take, is the high risk of bugs.
I guess this is very complex to script, but I have another idea relating to stats and player skills that would also be really fun, I'm gonna open another thread about it.