Even now with character limits being partly determined by medals, I have some misgivings about it. So far no one has outright gone "Plz give me medals, want more chars!" or something of that nature, that I know of. Still, it does leave that door open.
Indeed. I suspect that in the population of any other game it would have already been "gamed" and exploited...
That it hasn't (to our knowledge) is as a result of the combination of game nature, atmosphere and player base I wager.