I feel like having the GM (DM) being able to grant XP, possibly stats is a must. The more freedom you have when running a game with people the better.

And I agree that non-death XP would be a welcome system to improve player choice. Wether you would gain the same amount of XP is debatable, but probably ideal.

It would not change the loss of loot, but you would probably save on your charters own resources (more health, potions, arrows, grenades, ect)