One of the things I've noticed is that the death penalty is very, very hard to overcome - particularly as a higher level character.
The thought of loosing months of progress from a lag-spike, a dumb move, or just bad luck could really drive many people up the wall.
This might be mitigated if there was a way to return the XP loss in a reasonable way. You died and get raised? 10% XP gone, but...maybe 5% of that XP is stored as a sort of "pool" that doubles the amount of XP ticks you get. Yeah - it still sucks, but now its not as much of a loss.
Resurrection is made to 2.5% of the XP recoverable, or maybe even 3%, with a total of your 5% XP lost, that would also be a reasonable option?
Last, I could see making Death be more harsh, but not drop levels? Maybe death of a level 16 character causes them to loose up to 50% of the total XP to make the next level, but never drop back down to 15.
Losing XP sucks, loosing levels sucks way, way worse. I think having ways to mitigate the loss of levels, the real progress people see, would make it less painful.
In my examples, I used 15+ just because that's where death hurts the worst, I would propose the changes I suggested be applied to all levels.