I don't know. It can be done but you have to make a little bit of a buy. But hey! You are already playing a game with magic and gods and hot elf queens, what's one more am i right?!?!
Seriously though, in FFXI we had a very primitive three-nation system similar to TESOs setup in regards to each nation having a storyline. After you completed one line and received rank 10(or before if you wanted, though it was economically better to wait until rank 10) you could go to another nation and request citizenship. You then paid the fee and had your memories sealed.
Huh? You ask?
Well in the lore of the game, to keep things peacful, there was a convention that ranked members of foreign nations had to have their memories sealed during immigration and thusly protect military and state secrets. Pretty nifty imo. And practical because then you could go and do a new set of naation quests without that many hangups on whether or not lore was being trampled.
Keep the lvl scaling and add a little something like this for the Lore junkies. Win win imo.