That is a good suggestion, though I would modify it a bit. If you TR at level 20, you start at level 1 as you do now. If you decide to play at bit before TRing and are somewhere in the 21-24 range, you start at level 4, similar to vet 1. If you decide to play all the way to cap before TRing, and hit level 25, then you get to start at level 7, similar to vet 2.
Those levels are somewhat arbitrary based upon the vet status, and obviously up for debate. I make this suggestion because, as I read your suggestion, I think of someone leveling to 20, TRing, and then being able to start again immediately at level 10+. I think there needs to be some criteria based upon how far above level 20 you got to determine how far above level 1 you start.