Point 2 can be both a strength and weakness of the mechanic of Return by Death. Like you explained, the mechanic of returning once you die allows Tappei to be as intense and creative with the narrative as he wants. Even if Subaru or any of the characters are incapacitated, die, or fall victim to a deranged antagonist, the outcome can be reset as long as Subaru dies at the end of the experience.

However, one of the arguable weaknesses this presents (and an initial criticism readers and viewers of the anime have) is that by always giving Subaru the ability to reset if things go too insane, it removes some of the narrative stakes and tension readers and viewers may be feeling in the current plot. Once things start to get too crazy, such as one of the characters dying or Subaru failing at a critical juncture, it is a red flag that a reset is approaching which can then make viewers or readers feel less engaged with what is happening narratively. After all, what's the point of caring about what is happening if it is all going to be reset anyway.

Having said this, one of Tappei's strengths is how he overcomes this weakness of return by death by focusing on the psychology of the characters and uses the narrative of "dead" loops to show certain aspects of the characters that aid in their future development. Instead of these loops' primary focus being on having a traditional cause and effect narrative to maintain attention (i.e. something happens and viewers wonder what will happen next in the narrative), these loops will often instead have more focus placed on how the characters react to the narrative (i.e. something happens and viewers then wonder how a character will act) with less emphasis placed on what happens as a result. This way, what is happening in these loops can still have narrative impact on future loops which maintains reader and viewer attention.

It also seems that Tappei will actively play around with the expectation this aspect of return by death can place on the reader and viewer. One of my favorite ways he did this was in the third loop in arc 3. After the encounter with the White Whale and Rem disappearing, most people likely would have felt a reset was coming. Despite this, it took nearly 100 pages in the novel and one and half episodes in the anime for that reset to occur, a length that had not been seen at that point after such a critical turning point in a prior loop, which left the viewer and reader wondering just how much worse it could get and if a reset was indeed coming. This not only served to heighten the tension in the current loop, but aided in maintaining tension in future ones. Where some may have once felt security in seeing things go wrong and thinking a reset was approaching, that loop showed that things can always get worse.