In my experience the moment a character tries to look like a badass is the moment they fail at it. And the harder they try, the more spectacularly they fail. I always appreciate the effort, but that effort is lost when I see a great gap between what characters try to look like and what they are capable of achieving in the game. To me the best RP comes from players who reach a healthy balance between what what they can do in the game and what they like to portray.
When I look at a character, how much I respect/fear them is not so different in IC as it would be OOC. It is going to depend almost entirely on my personal experience with them, their reputation, how long the character has been flying, etc.
For example, a threat from a character like Istvaan Shogaatsu would alarm me a lot more than the "badass" bounty hunter fresh out of the academy with a overstated character portrait, but who is afraid to leave highsec and only targets NPC's.