Impressive Title did not have a fighting/dueling option, actually. Your character DID have a health bar though, and when hunting prey, the prey could kick out at you and lower your health. I think this was the closest anyone came to physically fighting in that game. XD
But, nonetheless, I did indeed hear rumor that this may happen, and the way you described it is exactly how I imagined it, believe it or not.
Though, as a previous poster mentioned, I'm positive there'd be spamming when it comes to this option. And I know that people take things far too seriously on here; There would be fights over the chat for sure. But I could definitely see it for serious roleplay in general.
Perhaps there could be some way to disable fight requests from coming your way if you don't feel like going on for that? If you perhaps only want to mind your own business or talk with a friend in Bonfire, and you don't feel like being disturbed by someone who wants to 'fight' with you.
Only my opinion. ^^ Still, I can imagine this would be interesting if it were added, and I'd be curious to know how it would be done.