I don't know. The classic RPG-leveling-up-fight-tougher-baddies-get-upgrades-and-improve-yourself model is definitely ONE way of running the game and ensuring that you have an incentive to keep playing, with the revenge motive being a nice little cherry on top. But I don't think it is the only way to do it, and I feel like a lot of games have adopted that as the standard even when it doesn't necessarily suite the game.
The problem with a leveling-upgrade system is that you have to provide such a ludicriously wide range of opponents that unless the game is very carefully paced it can really mess up the narrative. A game where you start out fighting rats and having a hard time of it, but then, two in game weeks later, you are tangling with ogres and dragons and the like, is kind of silly. It took me longer than two weeks to remember where the paper towel was kept at my last job. Plus, sometimes you're not in the mood to start as a nobody and progress up to the biggest guy in the world.
A lot of my favorite games are games which feature a protagonist who is stable, and the progress you make is your own ability as a player to play that protagonist. For example, the Thief games feature a protagonist who starts out as a master thief, but you still feel challenged at the beginning because you are getting into the swing of things. As the game progresses you go up against harder and harder situations, and even though your character is not changing or getting stronger you as a player are getting better and better at the game and thinking your way through those situations. Prince of Persia: Sands of Time is another example--you start out as this amazing acrobat, but as the game goes by the challenges get harder and harder and you yourself have to rise to the challenge as you work to play the Prince in a way consistent with his awesomeness (of course, the combat in that game gets a bit repetitive, but I don't think the addition of upgrades would have helped that).
The nice thing about a game in which it is the player who gets better rather than the character is that you feel like your progress is somehow more real--if it is your character in the game who gets better, often you actually get worse as a player, because things get easier and easier as you character and his or her upgrades pick up more of the slack. In games like that I've often found that if I start over and go back to the beginning it is waaaay more difficult for me than playing my fully loaded character in the climactic final stages of the game because I don't have all the nifty upgrades that make it easier to aim and increase my speed and jump height and all that. Plus, if you become a better player you can take that with you beyond the game. Now, depending on the game the knowledge and skills you take with you may not exactly be applicable in modern life, but I'd like to think that sneaking around in Thief has made me better at that in real life, and if I ever had to do that I would be better at it than if I had not played Thief. If the only improvement is to your character in the game, he will vanish as soon as your hard drive fries.
