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If you wanted to tier the rewards to the instances, you could make it even more like PvP honour gear - have each boss (hey, even trash kills as well) earn you a certain amount of, say, "renown", and additionally, the bosses drop tokens. Then your [Breastplate of Low Level Epicness] could cost something like 10,000 renown and 10 Karazhan Marks, whilst the [Sword of Uber Epicness] might be 50,000 renown (higher level raids would earn you more) and 20 Black Temple Marks.
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