Bumping for review.
As you can see, I got a little sad and annoyed by some responses.

I think that sadly the main idea "take Honor Points away on level difference" is not workable, for reasons already stated above. It is similar to try to devise a way to take Honor Points from, say, ninja looters.
It's just too complicated to set up an automatic system which is clever enough to sort out the different situations.

The fact is, this game is played by a lot of kids (and people whose mental age is still lagging). And kids still have to learn fully the advantages of co-operation and long time goals. This only comes by experience (I am talking real life too here), which is exactly what they don't have.