Well this type of scaling has been done before, I can think of one game. There when you get to max level and go to a zone let's say 20-40 level you get scaled to level 42-3 all your stats and you don't loose items and spells, BUT they don't have open-world PvP :)
So yeah that would be very difficult to balance. The idea of Bounty hunting + 5/10 level difference I think would work.
i agree, the only thing is to find a balance and make the bounty reward interesting enough to motivate people to get to the hunt, because if it is to get only few coppers or a grey staff of stupidity, it wont be good on long terms XD