I have had this crazy idea he is getting some sort of arm unlock. When you kill someone you pick up their weapon and integrate a part of it into your "mechanical hand". So if you kill a pyro and walk over his flame thrower you get a mini one built into your hand. Now is this of any real benefit? I don't know. Time will tell.
Taking your idea and running with it:
Instead of an arm unlock, the engie swaps his pistol slot for different upgrade styles for the sentry. Let me elaborate.
At level 3, the sentry is pretty darn powerful, but generic. This update could add a level 3+ sentry that integrates one of three things (each found from a drop) to it: A natascha mini-gun upgrade to the barrels (slows movement speed 50%), a "direct-hit" upgrade to the rockets (making them move more quickly and do more damage, but decrease the blast radius), or add on a mini-flamethrower sticking out of the sentry's butt, igniting potential spies, but also hurting the engie if he stands in it's way. Each upgrade would get it's own "item drop" part that would either fit in the secondary slot or the misc. slot, and would take an additional 100 metal to upgrade the level 3 sentry. The items should also be craftable, but instead of an engineer class token (that would just be silly) the weapon that is being copied would be required with the scrap metal and slot token. (I.E. for the natasha barrel upgrade part, you would need to smelt a scrap metal, secondary slot token, and one "Natascha")
If this is what they do, I so freaking called it. If it isn't,
Valve if you're reading this please take my idea into consideration. I love you guys and will wait until 2050 before beginning to complain about Half-Life 2 episode 3's release date.