Loss in a game is tricky. On the one hand, it’s just a game, right? Who cares if a player loses a character or two here and there, right? Just make another character and move on.
Usually, it’s not that simple. The player may have spent weeks working out the specifics of a background, tweaking a sheet until the character’s abilities and powers match up with their idea of what the character should do. Months, perhaps of play, researching and trekking through harsh confines… a character isn’t just a piece of paper and a chunk of plastic or metal, or a collection of bits on a hard drive, to a player like that; it has a life of its own.
A GM should, therefore, insure that killing PCs doesn’t happen without discussion, and irrevocable death should probably be undertaken with care. Some players may even have some good ideas about upping the stakes; something that you as the GM may find very useful! The same can be said for character equipment; after a few months in game-time questing for some kind of fancy armor, sword or a special mount, taking it away or rendering it useless is, if you will pardon the expression, a dick move.
At the very least, doing that kind of thing is rude. At worse, it will cause a game to lose players. In low-magic campaigns, or when using rule systems that assume a character has a given ‘item level’, for lack of a better term, this is doubly true.
I have been on both sides of the screen for this kind of thing, and it has prompted some interesting discussions, and no few arguments; I was then and remain now convinced that the GM’s goal is not character death, it’s setting the story, laying out the threads, if you will. That may include character death, but it should mean something, and it should never just happen.
In the end, the idea is to have fun; if it isn’t fun, there’s not much point in doing it, is there?