This part is about skills and character progression. (Number 1, 2, 3)
Right from the beginning it was clear that skill would have a level, that they would be used for bonus dice, narrating facts and some special function, like attacking, healing, defending. The set of special applications changed a lot. In the end, there were eight main types.
But how would skill levels be assigned? I wanted to make it simple. One experience point should be one skill level. Taking inspirations only from the best, I borrowed FATE's skill pyramid, but turned into stairs. In FATE, a character need always more skills at level n-1 than at level n. In B&B, a character must have at least one skill at every level from 1 to n.
This method is very clever way to have a character level, without having a character level. In D&D3 for example, there is hard cap based on character level. In FATE, there is an implicit cap: the highest possible pyramid you can build with a certain number of skill points. In my experience, such caps are the only way to reliably prevent characters getting too powerful. Other games use escalating costs for higher skill level. Higher level calculation aside, I don't think escalating costs do what they should. They are supposed to encourage buying a more diverse set of skill for a character. In my experience, players will only save longer to buy their favorite skills, thereby doing the opposite.
Next, I introduced add-ons to skills. These include specials like attacking several targets, healing in the fray, summoning better followers. Stuff like that. They are not always active, but require a special condition. There is a common list for conditions and a specific list of add-ons for each type of skill.
The concept is very similar to SFX in the new Marvel Heroic RPG by Cam Banks et al. That's coevolution, mind you, so I'm very glad that I have similar ideas as the guys at MWP. Unlike heros in MHRPG, heros in B&B shouldn't have add-ons to every one of their skills.
In the beginning, I tried to grant a bonus to skills without add-ons. But that didn't feel right. A simple skill should be just plain worse than an augmented one. The final solution was surprisingly simple and addressed another issue as well. It goes like this: Characters can only have add-ons to half their skills. Round down.
Again a hard cap was simpler than incentives, and more effective. In addition, this rule proved to be a further incentive to spread a character's skill set. A character with more skills at lower levels will have more add-ons.