More of a quality of life alteration, but killing the bandits to not see them again should not affect your reputation. At least when no bystranders and/or survivors are nearby.
Viewing post in Aric's Expansion Rebred
I completely agree. I’ve been trying to just work out the kinks on the brand new system to a point where it’s somewhat stable (hopefully it is now) but then I’m added onto that system a “Reputation” value and check so Bandits/Baddies don’t pull Captured/Innocent NPCs (and Vice Versa), Rep Change from Execution/Rape is only for “good” NPCs, and bad NPCs can be turned in to the Town Guard for a large Reputation boost.
It’s going to involve several possibly game-Breaking changes though so I’m going to try to release it very carefully. It is coming, though.