I've seen it in action. When I was merely a member of my main forum, it was enabled. Back then, I had the tales to tell related to the core of the site. I was leader of the board for reputation points for ages. Six months after leaving the job involved, I was still fourth.
I saw one poster - someone I liked immensely - brought down from third place to negative reputation by two or three cliques.
Human nature is such that I don't see that it will work properly without the species evolving more, especially when you understand that people are more likely to have a go at people they can't see.
When I took over the site and moved to VB, I disabled it immediately.
Rapscallion
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