I'll toss a few options out that spring to mind, most of these are separate ideas but not mutually exclusive

Sorry about the novel, I just started putting ideas down and fleshed them out a little as I continued along.
1. Kaldar's suggestion, although I'd tweak it slightly - rather than flooring gear score which you can actually fight with, I'd suggest flooring the xp based on a lower bound gear score. I think limiting the attack button to a gear score would enforce people to do more back and forth for inns/consumables and whatnot, especially during CB's, LB, etc when they just want to spam that I win button until their inventory is full or out of end or whatever. Just more interruption than strictly necessary. I think people should be able to hit until they lose to be able to understand the limitations of what they can/can't do with their build, gear etc.
> This only limits xp gain without having any real impact on any other issue, so really only a partial fix in my view if we are talking about a total effort vs reward system.
2. simply increase the penalty for using damaged gear ...
> bear in mind that any current penalties that apply on raw damage should also apply on poison and taint, although I'd be inclined to actually make this some sort of luck bonus (that allows chance for poison/taint application to dip below the pvp lower bound of 40%) rather than % damage reduction, as there is no 'base block value' in effect in order to be able to create a poison/taint threshold for damaging an npc.
> This is a simplistic approach that more or less builds on the current system already in place, upping certain value modifiers although I feel that the NPC luck bonus should be built in as the current system only handicaps raw damagers and is far more open to abuse by special damagers that are able to equip t1 weapons/shields with 0 effect on their damage output capabilities.
>> This is still restricting in the way the current system is with regards to hitting up levels, which I feel is too harsh. Capping XP is OK I guess, but nullifying XP completely for legitimately beating a >+5 in a duel is still crap.
3. Increase the level range of NPCs that a player can randomly face, based on their player level. eg at lvl 1 a player may face lvl +/- 0 (50), +/- 1 (35), +/- 2 (15) for example, which could scale out to +/- 5 (2%) at lvl 100.
> This is a scaling difficulty modifier only really, so not a total solution ... hell, probably not a solution that is really much of a solution at all, but I though I'd include it to maybe spark someone's imagination.
>> Despite it being a difficulty modifier, it would certainly make people think about their gear a little more if they were to lose a bit more often

but again, don't do this by itself, it would be bad, lol.
4. This one's a bit far out there ... introduce a replacement to the penalty on individual gear pieces that are damaged, and replace this with a global equip point penalty (which damaged gear pieces count towards already due to reducing ep cost of damage gear) - if you don't have your gear up to scratch, you get a blanket -dmg(includes raw AND poison and taint) modifier as well as a -def%. this one could also translate across to the level difference calculation as well, as gear score caps grow as lvls increase ... now whether that should work on a system like = @ +/- 2 levels, then increasing with another leap at +/- 5 levels, and then a huge leap at +/- 10 levels to lock down the level difference farming issue, or work on a flat grade, or some other variation perhaps you'd have to crunch some numbers to come up with the most appropriate solution there. My suggestion would be to have the +/- penalty flexed by the players' equipped gear scores.
> This is virtually a replacement of the current strength system, so likely the most time consuming/complicated to implement (and thus the greatest chance of breaking stuff as well)
>> Self regulating in terms of difficulty for hitting up/down levels ... if the +10/-10 (or scaled to the current +5/-15 or whatever ... though I prefer 10s myself) penalty was something like -100% damage on attack, +100% damage taken, then that would negate exploiting gear dropping - If scaling occurs based on equipped gear scores, then a 0% damage modifier modified by 50% would still be 0% (purely example numbers to illustrate the point).
>>> Offers a scaling risk vs reward for exp gain that is easily tweakable moving forward, should initial values prove too high/low, giving the difficulty junkies rewards for their efforts in matching gear to exp payscale. Also, however, would force casual players to maintain their gear somewhat