I like the idea behind the new standing system very much. A player has to think about attacking other players instead of just killing everybody. I'm waiting for more information about increasing the standing. In yesterday's discord discussion with Henrik has been some word about the possibility to increase the standing with one faction by killing of another faction. But I hope to see some ways like killing e.g. bandits in front of a city to increase the standing with that faction.
From a lore perspective it is very cool. In terms of gameplay I foresee that people will farm whatever mob/player that gives the best standing bonus, then kill however many they can inside their home base. To prevent this from happening SV would have to develop a very intricate system of controls (so that for example farming alt-accounts is not possible) and checks. Once they have done that someone will break it again.
I think guards should not attack based on the standings system, but rather only on whatever is going on around them (simulated by the criminal flag). That would limit the amount of possible exploitation drastically.
Standings could then be used for things like priests not reviving you, traders prices going up (deeds f.e.), certain items not being available (books) and the general tone (like guards are cursing us now). Bribes should be required to be higher. Taxes on resources and gold in your bank could levied.
Lastly the ways to generate good and bad standing should be plentiful and not only combat related.