I can confirm that rep decay was introduced in the WSG update to the Beta on Friday. Earlier that morning I ran some tests on known quests and they gave full rep when gray. However, after the WSG patch later that day, I ran some more tests and verified that rep decay is now in effect for gray quests. You can see the results of my tests in this thread:
https://www.reddit.com/r/classicwow/comments/bshono/regarding_rep_gains_on_grey_quests_closed_beta/
You can see the results of other tests I’ve performed in the Beta here: