After playing some more today, I have a couple of suggestions:
-Is the selection of item to lose on death completely random? Out of the various items, some vary greatly at the moment in terms of importance and ease of acquisition (demon smiters immediately come to mind, as they seem to only be acquired occasionally through quests), and I wonder if having such items weighted to disappear less often might help.
-Given that whether a defeated enemy drops anything is currently a binary proposition (NPC kills it = no drops, player kills it = drops), you can get into some “kill-stealing” situations where an NPC can swoop in and pick off a tough enemy you’ve finally whittled down, denying drops (and I suppose you could do the same to NPCs, getting the drops with little effort). I wonder if it would make sense to have the drops appear if you deal a certain percentage of damage to the enemy, regardless of whether you deal the final blow.
Also, I noticed a couple of small graphical glitches. When I killed an enemy in a corner of a building, the items it dropped seemed to get stuck on the corner, spinning around and unable to be collected. I also noticed that when you destroy terrain near the water level, it will create a pit full of water even if it’s not connected to a body of water, with the flowing water texture on it - not a big deal, just looks a little weird to have a little puddle of water flowing like a river.