Alright after reading this I kinda wish you would had looked at the one thing that you had been asking before and that is will this allow medium to small guilds the ability to compete and actually win a conquest. With this change the answer is now no. Why? Well if you take away the crafting aspect being repeatable they will not be able to compete and be beat out by mega guilds using their numbers to over whelm them in the conquest. The crafting being repeatable made them have the ability to compete and show diversity in the game with the different guilds.
Now what you are implying IMO and other's, is that you will have done what you said you wouldn't do and force medium and smaller guilds to lose their members to big and mega guilds. Well least the guild masters get their own luxury barge aka guild ship, oh yeah and an extra house aka guild stronghold. Oh you know that same thing that players that have stayed loyal to their guilds have spent credits, time, and CC. You are telling them you ever want to have the badges you can no longer compete or be loyal. Go join that big or mega guild so you can be apart of the conquest and get your encryptions. But wait what makes this more fun is that you will create a new player to become an ENCRYPTION PARASITE lets just call them EPs for short.
Let's see what will happen, EP joins mega or big guild with alts and gets conquest points and makes his 20k or 50k on these alts and they have the encryptions and the big/mega guild says hey you where are those encryptions that belong to the guild and they say I'm saving them or they are mine. Boom EP has been born cause they get kicked out return to old guild and give encryptions. You are also creating them as Mercs as well for the highest bidder. so for short we'll call them MEPs. You will screw with our economy. We already now have a few selling these on the GTN but now you will drive the prices up cause being a MEP is a dangerous game and can get many kicked out of raids and vote kicked out of pvp.
IMO looking at this from being a guild leader of MMOs since 98 I seen this kind of thing happen before when you have a free market and guild structure that keeps you supposedly by credits and time loyal to them. I say you need to keep the competitive option in repeat in the crafting rewards so that we keep the diversity of smaller guilds and stop servers from having 2 to 4 mega guilds controlling the aspect of the gaming by their consuls or unquestionable leader.