I've always used the level limits BTB (in D&D and others). The limits never really bothered me and I always felt the explanation given by the authors of the game was satisfactory.
If one is truly playing an OS version of the game, level advancement should be sloooooooow, and there's probably only a 50/50 chance of surviving to the level maximums anyway.
And what if a player does hit the level limit? Will that player just cash out the character and start another? Why not just keep using the same character (so what if you aren't going to level anymore)? I suppose it may get tedious and difficult after the other player characters (humans) gain a few more levels and move on to greater challenges and the dwarf/elf/half* have to keep hiding in the back of the party, but I think that that point would be a long way off once a level limit is reached.
Here's a theory: Players who whine about level limits are missing the big picture. They're too fixated on the assumption that they will be great heroes of renown and mighty adventurers in very short order. This thinking is the very antithesis of OS gaming. It's fine to dream, but I think if they concentrate more on being good players
instead, they will find that the "power curve" of their character is almost irrelevant. (Am I making sense?)
<< violently falls off soap box >>
Anyway, just my opinion. After all, it is just a rule; and we all know how we treat rules around here...