@Thenomain
I am not actually -sure- to be honest. I mean, Example MUD for me is Threshold RPG, that is where I played for most of my Mudding years, and though I do not anymore it isn't because I don't love the staff, or didn't enjoy the play, or that I found MUSHing to be the 'best' kind of dessert and I'd just never known about it. (It did turn out to be a more appropriate one for me as I got older and the time and direct screen attention I could put into gaming changed)
So there, and I don't want to be a spokesman because it has been a while and this is through the haze of my memory, but you die, you go to the Underworld, and the God of the Underworld brings you back. Now the idea is that npcs die all the time and don't come back, it isn't like The Land That Death Forgot is the theme, so death still has to exist as a concept. And rping as if death is permanent also prevents other sorts of rp-detrimental and game detrimental things such as camping around waiting for an NPC you just killed to respawn so you can kill him again. "Evil Wizard Zoobie has died, victory unto us, let us go!" "Well we could take him again, he'll be back in what, 15 minutes?" This would not be conducive to any kind of sinking into your character, and RP Muds are sort of trying to merge that "We like to party up with our tank, our healer, our mages, and whatever and go have cool adventures/explore/fight stuff in real time" with "Also we are telling a larger story involving races, religions, clans, politics, etc etc, whatever is in our theme."
Theme and setting don't say that death is permanent /necessarily/. There is a God of the Underworld, sometimes he restores deserving souls. The PCs are just very deserving souls? It's why I said it sounded a bit ooc. It /is/, there is a suspension of disbelief you are playing through. Because you don't mix what you know ooc with what you know ic, the same way on a WoD game you probably wouldn't say "I suspect that guy has Dominate 5, which means he will just make us do whatever, so lets avoid him." You wouldn't say "I suspect if I don't succeed in my attempt to kill this dragon, the great God Mortis will revive me, but I will not be nearly so powerful and I could lose all of my awesome gear, still it is worth the risk." You talk about the risk vs. reward as if death is feared because it is death, not because of the game mechanics of death.
Does that make more sense? I mean, it is perfectly logical that a game that wanted to incorporate some kind of 'death' that occurred when hit points were all gone that was not death exactly but something else, and still offer penalty so that the motives were there to 'play well' so to speak still existed could do so. The 'you die, you are resurrected, you may die again, but death is still death and we act like it is death because we have not written a deathless world' doesn't HAVE to be how it is. I haven't seen a game that plays with this shade of grey, but it could be done, yeah. I get you @Thenomain