Quote Originally Posted by geniusprime View Post
...the penalty is death.
Death is not itself a penalty. It is a state. What happens once you're dead? What effect does dying actually have? The answers to those questions are what make up a penalty for the state of being dead.

Death penalties are tricky things. They need to be severe enough to discourage dying, but not so severe that they discourage experimentation and exploration. Not getting a reward is only a penalty if you care enough about it in the first place. Failing to receive a bonus isn't inherently a penalty, unless it's a bloody good or wanted bonus.

A penalty can impact a single player or an entire group. It can affect resources or actions. The current weakness + return to aetheryte penalty targets the time resource. It can affect just you, or your group if it is necessary for you to be at full strength for the party to proceed. And if you don't wait for it to wear off, it can affect what actions you take with your character.

A massive durability hit, on the other hand, targets the money resource, but does not have any short-term or immediate effects unless you've crossed a durability threshold.

Experience penalties generally hit the time resource, and do not have an immediate impact unless one delevels or ends up creating an unacceptable XP spread in a leveling party. They are inconvenient over the long term but don't change a character's viability in the present.

Really, FFXIV's death penalty is about as mild as it could possibly get.