Thanks. Yeah I knew it had an affect on PVP ranking, I just wasn't sure exactly how it was calculated mathematically. Once you burned off your penalty, for example, were you ok? Or did you get a 2% reduction in honor forevermore, going forward, (to use your example).
When I was leveling my Rogue, back in vanilla, I happened to, one day, go on a gank fest of horde questgivers, just for shits and giggles. I don't remember how many I got. Probably 30-50 DHK's. I had no idea what it meant or what the reprecussions were. Once I realized I had effectively pushed myself out of competitive PVP, I just decided to make that toon my DHK ganker

Then TBC came and cleared it all and I had a good time.
But I never knew how it exactly mechanically affected things and once it got wiped, I never bothered to find out.