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The traditional way is to use traders, tip them, and wait overnight for their inventory to reset and tip them again. Larger sales lead to larger increases. Traders inventory can take up to 36~48 hours to reset but usually just over 24 hours is enough (25 to be safe).
Also, like you said, some encounters on the road that involve guards vs. bandits or cumans will result in reputation increase to the nearest town if you eliminate every enemy while at least one guard survives. If enemies run it won't help, so any perks that increase intimidation or make enemies run are bad. Sometimes you need to use a weaker weapon to prevent them from running away.
There are other encounters that help reputation for some towns (mainly rattay, ledetchco and sasau) like beggars or wandering salesman