Possibly could be more fun if there was more reward for it which I don't think really includes permadeath although the game seems to abound with sociopaths that get a kick from knowing they have caused someone else misery. Maybe an alternative form of xp that you only get through combat that gives access to other abilities?
Would be quite difficult to implement in a non-botable/exploitable way though, would require that you couldn't get xp from fighting the same person again and again and that the combat level of the character was factored in to how much you got.