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On some forums, they would show how many posts you made, and as you got more posts you would have a title attached to your name. There where entire threads of jibberish because people would make a post, and then spam replies to get their post count up just to have some title or to look like they know what their talking about (even when they have no clue what they are talking about).
All the levels do is add more friends spots and every 10 levels you get a spotlight space on you profile.
Levels/XP is not about how much you contribute to the community, it's a vanity thing people can buy cards to raise, all it's showing is the user is ready to use money on something not important.
The leveling system requires that a computer can make a decision. And deciding if you did a good job translating is outside the current ability of computers. They need simple Yes/No answers. If you read the 2nd paragraph, that is not an example, that is what happened on forums that granted people a prize based on posting. The same would happen with translating.
set up 2 accounts, one posts a simple line in french, the other responds with the same post in german, then spam away. and if you look at my question, that is what is going to happen if translating was usable to level up.
There's not a ton of ways to get free points to level up, so you can't really gain a bunch of levels for free, but there are free ways to gain points for your Steam Level.
Only that this would be pretty impossible with how the translation system works in Steam.
There are badges for translators. No clue if they are still obtainable nor whether they give XP, though.