I think the upcoming Far Cry 3 will have a level up system (I'm saying this because I believe one of the preview gameplay videos showed points for each kill, so I assume they'll go toward some type of leveling system).
I know Ghost Recon: Future Soldier lets you customize your guns, but I don't know if it's a progression type system or if you're able to do all of that from the beginning.
I know you said leveling up system, but there are also games that as they progress you get new equipment and what not. If you're interested, some games like that are GTA IV, Red Faction: Guerrilla, The Saboteur, and a good amount of other open world games (RDR was already mentioned).
Enslaved: Odyssey to the West has trees you can level up, but I don't recall it really mattering overly much which trees were upgraded, still a good game.
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