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the basis for having faction was so you could grow your char in whichever direction you wanted - RPG or PvP
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That is totally incorrect. The purpose of faction is to provide an incentive for PvP players to PvP. It's the PvP equivalent of experience/farming and allows someone to unlock runes, items and skills soley through PvP. It was NOT meant for you to be able to create a PvP character and play him like a PvE character. I have no idea where you got that idea from.
If you are really inclined to you can just take the items you gave to your PvP character put them in storage, remake and pick the items back up. You'll only loose the dyes you purchased. Even then you have some options as to what colors you want to dye your armor in the PvP creation screen.