Thanks for the positive responses guys!
I know citizens give little bonuses when rescued but I was thinking more in terms of a SG building its reputation by doing very public things. Hence the prestige boost as opposed to gifts from thankful victims.
Re: farming, the only thing it would change is how cool your base could be, so farming would probably stay in missions. I can imagine SGs organising zone hunts in the way some organise task forces now, with the added benefit of drop in/drop out flexibility.