I'm not sure about the classic or not faction issue. I didn't do the gnoll fang quest a bunch back then. But I did do it a little on my first charater on p99, and got to kos to the corrupt guards at one point. I was a little stressed since Qeynos was my starting city (although that probably wouldn't bother me as much now). The guards weren't horrible, but I did have Madame Serena, outside the Mermaid's Lure, assist them and kill me at one point
[You must be logged in to view images. Log in or Register.]
You can also re-balance your Qeynos Guard faction (good v evil factions) by doing the Honey Mead for Trumpy quest a bunch and periodically conning the guards. That's what I did to get back from kos.