According to Peter Molyneux, death in Fable 2 will be different than what we've seen in any other game. Fan website Loinhead (not a typo) recently landed an interview with Molyneux and they had a little chat about Fable 2, Black and White 2and exposition ruining immersion.
Right off the bat the Black and White 2 issues get taken care of. Molyneux admits the problems are a "list" and although there is plenty of blame to go around, ultimately they were "forced to finish the game." The money just ran out. He says if he could go back and do it again, they'd have started from scratch instead of looking back on Black and White, using that code as a jumping off point, and building from there. Molyneux says, "I wish we could go back to the start of the development ... start with a blank sheet of paper and plan it better."
But that's the past, Molyneux says that one of the big announcements coming up about Fable 2 involves death (although Molyneux gives it proper dramatic fashion in the video after the break). He says that death isn't handled well in most games, "You go back in time twenty minutes to do the same thing over again. That's fine if I'm playing a platformer, not so fine if you're doing an RPG game." World of Warcraft has the death run, Prey turned death into a minigame ... we'll just have to see how Fable 2 handles the life hereafter. Wonder if the dog goes through the same issue when he dies, or maybe the dog fetches you from the afterlife?