Well I Played through BG1 and 2 as a good character and a bad one and both times I enjoyed myself.
Of course it was more difficult with the evil one, but not utterly unplayable.
And I agree that one should have split this reputation thingie in renown and virtue or something simiar.
Check
www.teambg.com. A whole new bunch of bigger mods has just come out and also this virtue moddie. Maybe you should try replaying BG with this virtue mod, it could fix your experience.
But IMHo the greatest "Roleplaying" experience was Planescape torment. It was about a story of one man/woman , and IMHO thats much more important than combat.
L.