So what exactly happens when a player dies? Is it just teleport to nearest town, or do you lose some stuff, or is it simply the character died and you need to start with a new character?
No perma-death. I'd certainly have to support quick saves and rollbacks in that case. No fun for anyone.
Death will have consequences but they won't be of the "Crap, I need to run all the way back to where all my stuff is on the ground..." kind.
I haven't decided exactly how death will work but I'm pretty sure it takes you away from where you died and that you still keep all of your stuff. There may be some amount of "adventuring" involved to become fully "alive" again but I haven't exactly figured that out yet. I've implemented spirit realms and limbo planes in other games and I'm semi-fond of that approach. And this would fit nicely with what will be the core of teleportation tech.
At any rate, you won't have to run back to where you died for any reason other than wanting to try again... so you could decide, "Nah, that's too hard let me do something else" with basically no consequences for that action other than all the trouble you may have stirred up in some other location.
DUDE, You HAVE to go with the spirit realm idea! Me and dad will work on a mod soon for Minecraft, wich will do the same thing :3 You could have 3 options for dieing, if you die it pops up a gui with these options:
Option 1: Respawn, you will respawn at your spawn point, but lose ALL items you currently had, and will have to go find them if you want to have them back... ((For the new players that just started that don't want to have to go though a trial))
Option 2: Ghost, you turn into a ghost where you died, but have to wander around for a bit and find some sort of ressurrect thingy ma-bob... And ores look like stone while in ghost form, so you can't wander in caves with your new found powers to find ores :3
Option 3: Dead Trial, you go to a spirit realm and have to find the end to come back to life... After that, you can choose to re-birth at spawn with all items and NO 'defects', or back at your body, again, no 'defects'... The Spirit Realm will be like maze sort of place, with a few ghostly monsters that will try and stop you, if they touch you, you go back to the start :3 And it should be randomly generated each time :3