Something like this would have my vote. And I haven't actually put 5 points in the repair ability to see what that gets you currently, but someone who invests that many points should be rewarded with something a little cooler than just the ability to repair an item to its original 100% durability - like additional durability/damage/etc. over the 100% value.
I agree with additional damage/armour for repairing with a level 5 Repair skills.
Thing is, there's already a small window in which a Repair skill of 1 can be used. These aren't exact numbers, but the way it works right now is that if an item has 69/70 durability it requires a level 1 Repair skill to fix. If it has 50/70 durability, it requires a level 2 Repair skill to fix. I'm assuming it continues to get more demanding from there as you neglect repairs longer and longer.
So, you can't really cruise along on a Repair skill of 1 forever. A single battle (if you take enough damage or use a weapon often enough) can create a scenario where a level 1 Repair skill is completely bypassed as an option.
Another reason why investing in Repair as a PC skill isn't as good as having NPC's repair your stuff, because if you aren't micromanaging your repair. Plus you don't know what values you can't let the thing slip below to repair. Once it does, then because of the Ability point costs, it can take several levels before you can get enough points to repair something, and that's if you neglect points in other areas.
