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"Negative" experience was intended to protect new players from attacks by much stronger players, but times have changed, and we need to consider changes and a general discussion on this topic.

Drawbacks of the current system:

• Many players "stay" at a given level and don't advance.
• Top players don't have many opponents to perform SF, and there's a high risk of failure, so they unload their weapons and fight a "draw."
• There's little activity in fights, including wars.

These two server wars showed that removing negative experience significantly increased activity and the number of fights.

Lower-level players would also benefit – more fights (losses) mean more experience and faster progression.

The only restriction I would leave is a fixed 5% gold loss if you attack a player more than 5 levels lower (instead of the standard random 5-10% win).

I'm waiting for your comments

It would be a terrible idea to remove the negative exp. penalty, going with your logic the strongest knights on a server could attack literally anyone without any consequences. You are delusional if you think that any new/low level player will be happy to be attacked by many strong knights every day.
Exp penalty should not be removed in wars too, because everybody has to decide if s/he want to sacrifice exp for their guild in order to win the war.

I fall also into the "don't remove it at all" category. But I do accept it is not quite as clear cut as I would like.

As a mechanic it is a very good way to keep "most players" from hitting too far downwards; the XP loss can be criplling if you are on a dead world and of a higher level (and don't use the BG to boos XP weekly.)

However one could achieve the same protection by saying X% levels above a player = 0 gold even in a win if you are the attacker.

When I started I used the -ve XP to purposefully keep myself to a lower level by "camping" - I became exceptionally strong and thus went "baby seal clubbing" when the n00bs hadn't worked out they needed to bank to be safe from gold hunters like me.
As the server got older and fewer people started new chars, it became obvious I needed to gain levels + due to my huge stat advantage it didn't take me long to make up a lot of XP by hitting upwards (still gold hunting). I got PVP rank1 with 14,390 points as there was no BG back then. (currently no1 = 3k points today for contrast, but 15th has only 150 points....)

On my dead world, I'd love to be able to go hit any-one with impunity now, as it would potentially make my game a lot more interesting again; but at the same time those lower-levels would hate a near lvl200 stomping on them

Abolishing negative XP would be a mistake. This is probably the only protection that lower levels have against being constantly attacked by higher levels, and negative XP is the consequence that higher levels have to accept if they attack lower levels. Such an abolition only benefits the higher levels, but not the lower ones.

Lower-level players would also benefit – more fights (losses) mean more experience and faster progression.

Lower levels apart from a ridiculous 1 XP, they have gained nothing from it.

faster progression.

It does not help them progress at all; quite the opposite is true. They quickly give up this game. This kind of thing really puts off new players.

Negative XP should also be retained in wars. Server wars as events are the only exception, because such events should be accessible to all levels, and in this case it makes sense to deactivate negative XP on a one-off basis. However, a server war is not comparable to guild wars, where high-level guilds arbitrarily declare war on other guilds with low levels just to improve their own statistics. These are not glorious victories, but merely logical conclusions from such unfair guild wars. The abolition of negative XP would encourage this even more, and that is essentially what it boils down to. The ability to wage guild wars against lower-level guilds without suffering the consequences of negative XP.

Consequence: Negative XP protects low levels and guilds with low levels. Without such protection, they lose interest in the game. The servers die out even faster than they already do.

These two server wars showed that removing negative experience significantly increased activity and the number of fights.

Anyone who believes that server wars were so popular because of the deactivation of negative XP is mistaken. It was probably more the Moon Coin winnings, even for the losers, as well as the flat rate of Moon Coins if you registered for this server war.