So, here's the idea (sorry if it's already been suggested i did try searching) and there's no reason it has to be restricted to just pinks.

Combining two duplicate pinks on a lower level character creates a lower level (the characters level) scaled down version of the same item.

Not entirely sure if that is doable without having all of the items pre-calculated or if it can be done on the fly, but thats for the devs to answer i guess.

Thoughts? :-)