It seems the only use for the "show removed posts" checkbox in the user reputation history is to cause endless "did you check "show removed posts"" comments on Meta questions where users don't get how their rep adds up. It presumably also causes lots of confusion when people aren't aware of the setting.
I really don't see a reason for this checkbox other than to confuse and annoy. I'm sure that's not the intent, but it's the effect. I suggest that it should default to on at the least...or even better the function should be removed all together and you should just show the posts. They're not actually hidden except through an awkward UI, so I don't see any use here.