When you kill gnolls, your faction with the far seas trading company goes up. I have no idea what this does as of yet. However, with the centaurs, they are not aggro to you when you first go into the thundering steppes, but as soon as you kill a few of them, they will aggro you. Not really a good idea to kill them if you plan to harvest T2 resources as I have had many walk into me while harvesting and was really glad they didn't. However, if you want your AQ6, well ur gonna have to kill em, and fortunatly for me, I dont really want it lol. Another place where faction comes in is in guilds. If you do a writ for a certain faction in the city ( Queynos Guard, Tellurian Alliance, The Concordium, The Celestial Watch or the Ironforge Exchange ( crafting ) ) your faction with that faction ( lol ) will go up, but your faction with the other factions ( hehe ) will go DOWN! That means that if you do writs for everyone, your faction will not go up very much, but if you do writ after writ for the same faction, your faction will rise more quickly, allowing you to purchase certain armor items from city merchants with coin and status. I have just been doing any old writ, but I am going to start concentrating on the Q Guard, as they give out heavy armor suitable for my Templar.