Psychochild's blog (RSS) sets a weekly game design challenge, which is a great exercise for thinking about possible game systems and game mechanics. This week's exercise is coming up with a successful PvP design. I've commented on his blog, but it's worth repeating here as PvP games with advancement are fundamentally broken. As David Sirlin points out, it's like a grandmaster getting two queens instead of bishops because he's been playing longer than his opponent. If you disagree, he's written an excellent article criticising World of Warcraft for this reason, among others.
So the challenge for anyone doing a PvP design where they want to allow advancement is to come up with a fundamentally unbroken version of advancement.
My suggestion follows:
[Edit: You'll probably want to read 'How to make a game with PvP Done Right'.]
If you are going to do PvP with advancement, I'd recommending taking a leaf out of the Call of Cthulhu RPG design and have a learn through failure approach. The loser gets to pick one ability that the winner has used, which they don't know. The winner improves the ability picked, and the loser learns it.
That immediately makes the advancement through PvP technique have it's own tactical component in terms of which opponents you select. By restricting the ability chosen to only something that the loser doesn't know, you also encourage people to go out and find enemies that they haven't fought before. They may even be encouraged to set up 'dojo' like systems, in order to train as many beginners in the ability they want to improve.