Legends of Kesmai or maybe Islands of Kesmai was the second MMO-like game I ever played. It was a standard fantasy setting presented in an isometric view where the barely animated player moved square by square through the world. This time you could see the monsters before they were attacking you as well as other players nearby. The one thing that stands out in my memory about the game was the death penalty. The death penalty here was easily the most severe I have ever encountered.
If you were beaten by a monster first all your items would drop on the ground. If the monster was intelligent it would take some or all of your gear and equip it or just carry it around. You would respawn back in town and suffer some stat loss. In order to recover your items you would have to return to where you died, naked, and collect your things. If a monster had taken your gear you would have to find and kill the monster to get it back, provided no one else had killed it and acquired your things before you did. In order to recover your stats you would have to perform a quest in the underworld. I dimly recall attempting this quest just once. The quest was long enough, difficult enough and sufficiently frustrating that I never finished it. In fact at that point I believe I decided to quit and stopped playing entirely.