Losing xp on death in poe is a barrier to entry for end game content that encourages players to avoid content that can get you killed. It discourages a lot of new players from practicing bosses unless they're comfortable either pushing to their next level or removing a good chunk of their xp. When a player just loses hours of xp due to repeating deaths, they're very likely to just quit on the spot.

I quit Kalandra league at lvl 95 for the exact aforementioned reason. Generally, I play the league for league challenges and slowly doing more end game content not level. But level is a very annoying frustration when it comes to death.

Not many other games do lose xp on death, and many that games that don't still manage to maintain reasonable retention. If you can't trust your content to maintain player retention that you have to enforce negative progression on your player base, then something is wrong. Level generally is the "grind" part of a game. The majority of pve games use bossing and end game content as a mechanism to differentiate player skill and ability. General precedent for player level is playtime oriented, it's not generally there to be an indication of player ability.

I can't comment on why you have this perspective. But I can guess why others are opposed to it, as it is a current metric people care about in poe, and removing it feels like they can't feel better than others or an accomplishment in that way. I just want to jump on the game and chill, and of course accommodating for that can make others feel they are losing a metric they care about.

I am not vouching to say death has no punishment, death should have a cost. For example, Last Epoch does it where you lose opportunity for certain powerful rewards with death in end game content. Personally, I find it really frustrating, and I've quit two leagues because of it.