I like the iteration of WF you describe, but never experienced it myself.
However one of the nice aspects of titanforging is that it made lower tier content a little bit more relevant, so might i propose another variation?
One where the same gear drops from all difficulties, but just less developed in terms of WF upgrades.
Like the baseline item for a given raiding tier drops from raid finder, with a chance to warforge to i.e. normal level, and a normal level would warforge to heroic, heroic to mythic and mythic to mythic+1 level so to speak.
That way you can keep a piece of gear as you progress through the difficulties, and needn't be dependant on luck alone to upgrade a piece. Naturally the price for upgrading rises steeply as its upgrade level rises, but you should also be able to strip a piece of gear of its upgrade to get part of the invested valor points back.