Need quick lvl-up advice without killing my party...

Actually, I have had the players enter a town and be mistaken for brigands. They were surrounded by the city guard before they had much of a chance and arrested and then thrown in prison. But there was a lovely lady that had fallen for one of the players she saw in the street before the arrest, and she got them out of prison. So, that's how I did it. In fact, I used this start several of times with new groups. Makes them aware they can't just tromp into town and take it over.

"No weapons no beer, no weapons no beer," chants the guard at the gate.
Dunno how you do your xp:ing, but just give them a low-risk adventure with a lot of brainy stuff going down. Something with lots of plots. If my players crack a complex plot I, at least, have no problem with showering them with experience.

This reply is an infomercial for the Nordheimer Adventure Seed thread... :p
Yes, I agree that my suggestion is a bit gruel but hey, it's Hyboria after all :twisted: But on a more serious tone you are right that if players have spent hours picking their equipment then it is a bad move. While I am thinking to use this as a start then I just say to players that they don't have to bother with the equipment at that stage :)

Obviously there should be a pretty simple way to get away from the prison (like a horny jailer and a female PC, you get the picture). The way I figured my group's escape is that the female PC (a thief) has managed to smuggle a dagger to the cell and when a drooling jailer comes to pay a visit...

Still, getting out of the cell is just a beginning.

Anyway, I have never started a game this way so it would be novel for my players as well. But this is just my suggestion nothing more, nothing less...
I agree, always give a try to something you haven't done before. Only way to find out if it works or not. Sounds like a lot of us have read The Hour of the Dragon. :)
The campaign is underway and the "prisoner" model was applied to the Vendyan Noble. She didn't come with much equipment anyway, so depriving her of her starting gear wasn't too teribly ill recieved by the player. She got a scimitar very quickly from dead brigands anyway, and eventually got her whole kit back.

After discovering the source of the bandits they now have to decide to investigate their hide-outs to the south west in Zingara, or to follow the trail back to Yara and the Tower, to whom and where they were taking the noble to be sacrificed by the sorcerer.

I'm running it pretty free-form at this stage. They can go into the hornet's nest and fight more bandits, or move on to the Tower next.
Before you send them to their doom in the Tower, you might want to have them face off a pack of starving wolves with laryngitis up in the mountains. You know, get 'im ready before you throw them to the lions, literally. :D