You are a plumber. From Italy. Running around and jumping on tiny little platforms, almost skidding right off them. There are hordes of evil minions of death marching towards you at a terrifyingly slow pace. The sky is bright blue and there are green bushes everywhere, but inside your head, there is a huge grey cloud looming overhead. The world is a gloomy place.
And then you die.
Game over. Try again?
Game death. It is handled completely different than real death. Does Princess Peach go into mourning when a koopa shell hits Mario? Is the world doomed if Link loses all his health (and by the way, that's another interesting topic I may expand on at some point)? No. It isn't.
Why, then, do games strive to reach reality when you can't die? Think about this: A game in which when y0u die, it actually has implications on your gameplay - maybe not staying dead forever, but perhaps changing the plot...
But that would need, like, a load of space and a load of power. But still, here's hoping for an innovative game like that, eh?