It's also essentially what xp was originally trying to abstract. And while in xp systems that intention faded through time to a purely mechanical motivator, "practice leveling" brings it back in some degree

What about "practice leveling" like what Call of Cthulhu or in some part Triangle agency dose?

I'm not that experienced to know any other examples
but that system feels compelling to me, as your power is now not just a reflection of your choices but your actions too.

You could say that loss worked similar but I feel like it's completely different

I personally can't think of another meme that acted like this. Let alone which was popularised like that

HAPPY BIRTHDAY!