My reason for racial traits in place of attributes is that with physical level, you can purchase the traits yes. But how many trait points you have to equip traits is already completely based on rank. It wouldn't interrupt that balance for that reason. However, if it were implemented it may be slightly unbalanced at first until tweaked with updates.
Edit: Also, I really like the idea of HP/MP regenerating faster with higher physical level instead of higher HP/MP to preserve balance. Would allow you to rank faster yes, but you would still face the same challenge as anyone else in a fight WHILE fighting the enemy.