Seriously I agree with everything TC said - its clear SE is afraid a death penalty will deter players from the game but it wouldn't be the case. In FFXI it was harsh because everything agro'd and some zones were tight knit, in FFXIV this can be mitigated by having some zones with "safe passageways" to get to and from other zones (these would be the lower level zones). An xp penalty isn't the do all end all for FFXIV, it wont fix much of anything to be honest but it'll give you a sense of fear and it'd be perfect with the battle system changes you guys are working on.