This is sort of a two-part question. I'd be surprised if this hasn't been asked in some form already, but according to the faq, that's "OK and deliberately allowed."
On StackOverflow proper, I have a respectable amount of rep1. Certainly not as much as the heavy hitters, who must have neither jobs nor family, and seem to tend to live near London, but enough that I feel that people at least give my answers a fair read.
Here on meta (and on ServerFault, etc.), I'm a veritable neophyte.
I assume that there are two basic reasons for keeping the rep/badges separate among the sites:
Just because someone has expertise in one domain does not guarantee that that person is knowledgeable in other domains.
While I understand this argument, I don't feel it's complete. If someone is conscientious enough to construct good, well-thought-out answers that are helpful enough to receive substantial votes and to be accepted answers, then it is a good indicator that that person will continue that behavior. A person not known to give poor answers on topics he/she knows little about will not likely start doing so just because the site has a different color scheme. That is, a person with good answers on SO will not likely spew crap on SF, SU, MSO, etc. If the community thinks a person is worth listening to, then that should carry some weight in other places that significant portions of the community may visit.
And after all, there is a fair amount of overlap in the knowledge domain of the SO/SF, etc. family of sites. I'm a developer by day, but I administer my own home network by night. So there.
A rep reset allows MMORPG rep whores who've "won" StackOverflow to play again on its sister sites.
I don't mean that to be pejorative at all. Earning rep and badges is fun, and a big part of what keeps many of us coming back. It provides a sense of accomplishment, and of recognition. And I understand the attraction of having a whole new set of goals to obtain. Nonetheless, it would be nice to have some continuity between these very similar playgrounds we play in.
So, the two parts of my question:
Shouldn't there be some recognition of rep from sister sites? Perhaps a mention of a user's overall rep, as well as their rep count for the specific site. Perhaps I'd be listed as:
P Daddy 123 / 3866
Where 123 is my reputation here (it really is), and 3866 is my total reputation on the /M?S[OFU]?/ family of sites.
With or without that, there is a definite disconnect among the sites. If I receive a comment or answer on one site, it would be incredibly helpful if I could be notified on one of the other sites. I spend most of my time on SO, and would love to keep track of activity on the other sites without having to check all of them all the time.
Also, when I read a post that I find to be of high quality, I sometimes like to see what else that user has posted. But unless I explicitly check the sister sites, I can only see that user's activity on the particular site I'm on. Let's spread the love! It might even bring more traffic to the sister sites.
I apologize for my long-windedness. I tend to be that way. There ought to be a badge for it!
1: Around 3600 as of this writing.