That sounds like a really neat idea! I like it. This could bring back some RPG in MMOrpg. You could even advance this idea and see it as some sort of a secondary talent system that lets you unlock and setup different traits and setups. More options for character customization and progression wouldn't hurt the game.
I wouldn't be a particular fan of unlocking them via leveling up each race, though. There should be a better way to do this, e.g. linked to certain achievements -> unlock "permanent 10% more reputation gained"-trait to X amount of Exalted reputation achievements and stuff like that. Just an example. You can be creative. Everything goes. Maybe even specific and challenging scenarios like the Mage Tower in Legion.
Anyway, great idea! Hopefully someone at Blizz HQ is gonna read this.