To me, if Yoshinaka loves Vallaki then he should stay there, if he seeks to increase his fighting skills to even greater heights then he may want to bitch-slap a glabrezu in a far off domain. Let him decide his course of action. I believe we lose a piece of what we are if we let rules dictate gameplay strictly and override character-motivation or setting-lore material. Its a system that in the end is more of a DM-friendly system than it is a player-friendly one. It does solve encounter conundrums for DMs who utilize combat encounters, and as DMs are a precious few commodity its best to keep them as happy as possible I say. Truth is though, for every player like Hlot who believes that high levels are ruining the fun in Vallaki, there are probably ten who are faced with a frequent dilemma of whether to choose zero progress on their character they have gotten the most in-character on by setting up kip in Vallaki, make a new one to enjoy Vallaki and all it offers again (including most factions and the most active underworld/outsider types), or just forget that Vallaki exists and as a result never get to interact with any new characters or players. None are ideal at all. I feel we could do better than our current status quo.
For me, I choose to do only what my character would do or has been enticed or prodded to do. Its on principle more than to disregard the status quo.
I go to Hazlan with my newbs and to Vallaki with my olds. If I want to take Chessryn to Vallaki and bitchslap the entire outskirts and deal with the fallout and consequences, then I do just that. The ingredient I find most lacking on PotM is the butterfly effect. The first step to a story is putting the characters in the same place at the same time, and the intermingling of the playerbase is more fractured now that this xp system is in place. Its probably the most major change since you were last active, Helaman. Its more subtle than a new domain or a new set of loot items but its impact is probably even more great upon the experience of playing and how it shapes the narrative.