From this situation you described, I think it’s fairly obvious that the current state of hoppers needs to change. In general, sudden, instant death paired with a heavy penalty on death is just not a good combination. However, I disagree with you on which needs to change (and for what it’s worth, your proposal of ‘only equipped items take durability loss’ very viable).
Your situation says to me that hopper mechanics need to be re-evaluated. Either 1, they should not cause instant 100-0 death, or 2, they should be much more avoidable, giving an escape opportunity like how grenade mechanics in many shooter games tell you the location of the danger, and a predictable detonation delay after landing so that a quick player can seek shelter.
While your equipped items only suggestion has its merits, it’s also pretty easily subverted by simply unequiping everything when you’re in a pinch. It’s not hard to imagine that many players will painstakingly equip and unequip their tools as needed to avoid death penalties. This creates a behavior that is tedious, avoids the danger of death penalties entirely, and is (probably) not fun.
That being said, I feel strongly against skills that reduce death penalties to 0 for much the same reason. I think this entire interaction of death penalties needs further refinement.
I think you’re over simplifying kal-el’s opinions here, and even somewhat contradict your self in a few places. In many situations, death does effectively mean loosing all of your equipment. I may only die once between my house and my market, but now I can’t sell any of my tools because they are all irreparably damaged. 4 deaths over any period of time (seconds, weeks, doesn’t matter) will reduce an entire inventory of tools to 1%. Regardless of how avoidable death is, it can still happen unexpectedly, especially in scenarios like kal-el described of sudden, unavoidable death. He’s not saying a death penalty is not essential to the game, he’s saying that in its current state it is detrimental to his enjoyment of the game.
Let’s remember that while this game isn’t Dark Souls, even that game gives you a chance to redeem yourself for a mistake made once, and above all, Dark Souls is fair.