If what you're looking for is flavor, I have to echo Nagol: Earthdawn has excellent and flavorful rules for this. The core conceit in Earthdawn is that magic follows a "weaving" metaphor, so you form magical links to things by creating (astral, intangible) threads to things (whether so that you can cast spells on them or so that you can use the full powers of a magic item).
Magic items have unique histories and progressive sets of powers (in D&D terms, a sword might start out as +1, then become +1 Flaming, then become +2 Flaming, then become +2 Flaming Burst, then become +3 Keen Flaming Burst). In order to get the better powers, you need to weave additional threads to the weapon (or the staff, or the armor, or whatever--any major magic item). And there are then requirements to weave the thread--usually a level (circle, technically, but same thing) requirement, plus a requirement to spend XP, plus often a special requirement--either a key knowledge, usually about the history of the item, or a key deed. Also, magic items to which you are attuned have magical powers against you, so they really become a key part of your character.
So, to continue the example above, a weapon might look like this:
Firebrand
Initial attunement (250 XP): +1 bastard sword
2nd thread (250 XP, min. level 3, Key Knowledge: must discover the true name of the weapon): +1 flaming bastard sword
3rd thread: (500 XP, min. level 5, Key Knowledge: must discover the most famous wielder of Firebrand, and that wielder's most famous deed with it (GM knows: Firebrand was the sword of Sir Elros of Hamlin, who used it to kill Averick the White, a great white dragon): +2 flaming bastard sword
4th thread: (750 XP, min. level 7, Key Deed: Must take Firebrand to Hamlin, and plunge its blade into the Fire River that Sir Elros's family used to forge it): +2 flaming burst bastard sword
5th thread: (1000 XP, min. level 10, Key Deed: Must land the killing blow against an adult or older white dragon with Firebrand): +3 keen flaming burst bastard sword.
Obviously, special powers would be fine as well, instead of just the standard power progressions. The other key is that this means that most major steps generate adventures. So you want to get the third thread, so first you have to go searching for ancient lore that tells you how to get the third thread (i.e. that you need to know who wielded Firebrand and what they did with it). And then you have more adventures to recover the lost book that you've only seen references to that tells you the answer (or in the case of key deeds, you have to go on an adventure to accomplish the legendary tasks). Also, you could feel free to delete the XP requirements (or even reverse them, providing rewards for accomplishing goals--as I think about it, I can't remember actually whether they were costs or rewards in Earthdawn). You can also have either implicit GP costs (oh, to get the question for the next stage you have to pay a sage 500 GP to research it; finding the answer is an adventure for you) or explicit GP costs (you need to perform a ritual using rare and costly ingredients as part of the leveling up routine).
Anyway, I think if you use this as a model, you'll find that there's lots of potential here.