During character creation I tied the Tower of the Stargazer to the ancestor of the player characters, they discovered that the tower was a inheritance from their great grand father who was rumored to have been a sorcerer. The magic-user, knew her great grand father was really a sorcerer since she learned the dark arts from his old books. The group were going to explore the tower in hope of finding some treasures to pay the family debts (and for the magic-user, in hope of finding more arcane lore and spells). I added in two dark secrets to be discovered.
At first I thought it was a interesting idea to link the character background to the tower background, then during the first session after loosing two characters I thought it was a VERY bad idea, but it ended up paying well during the second session. During the second session, It was nice when the characters discovered that their ancestor was in fact the apprentice of the Wizard. But at the end of the third session Aurore (the magic user and the character who had the bigger background link with the tower) died while opening a trapped chest and I ended up not knowing anymore what to think of the initial idea.
My original thinking was that linking the characters to the location's story would make them feel more involved and would make them care more about their character and the nature of the tower. Since LotFP is a horror game, I thought that the characters needed to be more then random adventurers, I thought they needed to be part of the location's story, so we would care more about them and we would fear their death, etc.
I think now it was a error, because once your characters are part of the story, you start having expectations, hoping for good scenes where the characters interact with elements linked to them, etc. It become easy to start playing the game in your head. And even when there is no plot, when a character die before interacting with the location elements you tied with her background, you naturally can feel some kind of a let down. This is what happened during our third session when Aurore died while opening a trapped chest. It was really tempting to try to save her (but I din't do it).
That said I really have no issue with PC death in my Labyrinth Lord hexcrawl campaign where the PC are all random adventurers with no backstory. It just that with LotFP I thought that giving the characters more background, etc.. would have been a helpful technique to give the horror more impact. But now I think that horror can work fine with random adventurers. This also came from the fact that when I played Call of Cthulhu, we always tried to flesh out our characters and to give them a interesting background in hope of caring about them from the start (also in CoC we often tried to link the characters to the background of the scenario, also don't know if it was a good thing to do).
One thing about character dead and horror: I don't observe that character dead always contribute to the horror. I agree that it is important that horrible elements have horrible consequences. But I don't know if dying is always the most horrible or interesting consequence when you are trying to build a strange atmosphere.
I am saying this because, up to date, each time a character died in our LotFP sessions, there was simply no reaction from the other players and their characters. They are baffled, then joke about how the game is so deadly and how characters die all the time. Then they don't know how to react in the game and they just quickly switch back to trap detection and puzzle solving mode. Again I really don't mind this in LL, but with LotFP, it kind of feel strange, I don't know why, I guess that because I expect more immersion because of the ties with the horror genre.
Also I note that once you die, the horror stop for you. The game come to a stop, we talk about rolling a other character, etc. But with other dreadful consequences, you are still there, stuck with those horrible consequences, the horror is still present. But naturally it important that you know that death could be one of those horrible consequences. But again I am just wondering.
But maybe this is a question dosing? Death trap are fun and I want them, but maybe when you place a death trap you better think: "yes this would be super interesting or great if a character would die here!" If not, maybe think about other horrible or weird consequences. Also when you put random chance of dying, expect that it quite possible that a characters roll 1 on 100. Maybe that dying too often in mundane pit traps lessen the impact of dying at the hands of horrible and weird things.
Note that I am asking myself questions but I don't want to answer them too quickly, I want to play more to better experience the game. For now, I can only say that for our group, dealing with character death feel different in our LL hex-crawl campaign and in our LotFP campaign.
Maybe I wish to put too much emphasis on the horror, weird and erotic vibes of LotFP. (those are the 3 main things that attract me to the game.) (yes I see erotic themes in the game, I guess it go with the title, the cover illustration and the weird fantasy genre (or the covers of it magazines)).
As for the use of fear or sanity rules: On the first session since we had a hard time building the atmosphere, when the two characters died struck by lighting I admit I kind of wished for some fear or madness rules to underline what had happened. But during the second session, once the group started exploring the tower, the atmosphere just build itself and we really felt no need for such rules. What I like with location exploration, is thath once you are there, really interacting with the environment, the rooms, their content, etc the immersion is really strong. The system kind of vanish, but loom in the background like a deadly menace.
I hope I am not boring you too much with my lack of OSR games experience. I admit that lately I think that maybe I should only post illustrations here.