About Rentai's Life Points: I feel the current state of the battle system is too rapid and it is very easy to die, with a 10 point penalty I can't see anyone having many points ever unless they just sat AFK for a few days, but that shouldn't count and should such a system be implemented, I'm sure Square would have some sort of check for that.

I do feel that there needs to be additional punishment for death. Perhaps some sort of delayed durability loss on armor. So you die, and it puts a debuff on you that lasts X hours, when it runs out your character notices additional damage on the armor and drops the durability by 15% or so. That lets you keep going without having to rush back to repair, but still puts a cost on death other than a minute or so wait.

Or maybe a system like Guild Wars. You die and take 15% hit to HP, MP, TP and damage dealth for 30 minutes. Die again and it is 30%, 45%, 60%. Killing monsters successfully will reduce the % based on EXP gained, say 1000 EXP per 1%. At 60% it should be pretty difficult to accomplish anything. But this might lead to frustration with players repeatedly dying, so maybe the 30 minutes doesn't change with extra deaths. Worked better in Guild Wars due to the instanced design, but I think it could work with some modification.