Oh I like this, I like this a lot. Even if not true neutral, it could be a different way of answering the 'let me play X race on Y faction'. The faction tags in the db would probably refute this, but a man can have his delusions.
Yeah I hear you. Just wouldn't make much sense from a lore perspective for, say, a draenei to spend eons fighting the burning legion, become lightforged and then... start at level 1 :P You're right though, would interfere with boosts.