This rumor comes out before every major patch and it never happens.
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I doubt it is true since taking the time to get every reward for the given bracket would then level you out of it
Nonsense - if you started the BG at X1 and did nothing but BG then you'd easily get all the rewards for that bracket - heck, they could even expand the BG dailies and add even more quests to BGs to make it so that you could actually level from 10 to infinity in BGs.
Think about it - they could add drops to player corpses in all BGs like they've got in AV and make quests for every level range - bring me 5 heads of each race, kill 10 of each class, kill 20 pets, etc. You could even find a way to modify the class quests so as to allow peeps to do them in BGs as well.
Heck, they could even have players drop loot based off of the player's level and gear, in fact, the loot the player drops would be a copy of something he's got (he wouldn't lose it, but if your rogue was carrying a dagger of twinky uberness then someone who kills you might get it as a rare drop).
Think about it - that'd add a whole new dimension to the game (as well as rid us of X9 twinks) by giving XP rewards and expanding the number of BG quests so as to allow a character to level by doing nothing but BG.