Levels in RPGs

The idea of "character levels" in RPGs has always irritated me somewhat.

 Levels are a very artificial way differentiate relative power, though they are very easy to work with.  I forgive their usage in pen and paper games on the grounds that you don't want people to have to use an advanced graphing calculator to determine the results of an action.  I also understand that they're a very easy way to supply a feeling of progression to the player.  I'll even allow that they're okay to use in a scripted closed-ended (that's the correct term, I looked it up) single player game.  If you look at a lot of the Final Fantasy games for example, they use levels and have a cap at 99, but you often reach the end of the game in the 40s and the game basically forces you to reach the needed levels for any given piece of content as you work to reach it.

The real area where they bother me is in the MMORPG genre.  It's especially irritating that you basically play two different games.  You've got the leveling process where you're working your way to the cap in which you generally play through story-driven quests often by yourself until you reach a cap, with the option of doing small group dungeons if you wish.  Then at the cap the game switches to doing a handful of dungeons to gear up so you can do a handful of raids until you cap out on that.

If you prefer the story-driven quest game, the first phase is great...but then it ends.  If you're lucky, you get repetitive daily quests you can do at the cap, but for most who prefer this phase, doing the same quest over and over doesn't come near the level of the actual enjoyment had when doing "new stuff".

For those that prefer the "end game", that first phase is just a dull grind you're forced into before you actually get to have fun.

My aim is to design a system where there is no magic line where the type of available content completely changes.  The player should be able to continue improving their character so long as a challenge can be found, and varying types of content should be able to be found at all skill levels.