Classic MMORPG games like Ultima Online and Everquest had something that new MMORPGs today simply don't have. When you were killed playing Ultima Online there was a strong sense of defeat and loss. You actually lost something when you died. You could lose all your possessions that you were carrying. This sort of game play made it so players didn't always carry their best sword of their best set of armor with them, as there was always a chance that they could lose it. If a group of people saw you carrying a shiny sword of vanquishing, they would be inclined to kill you and take your gear. With an open PvP environment, where anyone can attack you anywhere in the game, except while you're in town, it's best to make allies quickly, or you'll quickly lose your hard earned equipment.

In Everquest death was extremely annoying. If you died in Everquest, you would spawn back in town without any of your possessions, and in order to reclaim them, you would need to return to your corpse. If you didn't return to your corpse within a week, your corpse would disappear, and your items lost forever. Don't mistake this with a silly corpse run in World of Warcraft, as in order to reclaim your equipment in Everquest, you would need to physically run back to your body, and without any of your equipment, that can be incredibly difficult, and if you fell into a lava pit, good luck trying to get your corpse back, as you may need to spend an entire day trying to recover your body.

In the new age of MMORPGs and MMO games it just doesn't feel rewarding to kill another player and there is simply no sense of loss when you get killed. In World of Warcraft, if you happen to die, you basically get a slap on the wrist, as the only thing you lose is a bit of durability on your equipment. You'll need to die 10 times for your equipment to get damaged enough to hurt your coin pouch, and you won't even lose any experience for dying. At least some anime inspired games like Maple Story and Fly For Fun incorporate a real penalty for death. In MapleStory when you get killed, you lose a good chunk of experience. It'll take you at least an hour to regain the lost experience.

A good penalty on death Is good for MMORPGs. In World of Warcraft, there really is no reason to be cautious while grinding as if you happen to die, it's nothing more than a slight annoyance. In MapleStory, players constantly carry hundreds of healing potions with them, as they'll do everything they can to avoid death. This sort of game play prevents players from acting irrationally and stupid, which can result in group wipes while raiding or just hunting as a group.

source:
http://mmohub.org/2008/evolution-of-death-in-mmorpgs