Good ideas!
I always find it tedious how the opponent sov and\or heroes wind up reviving in the next nearest city to the one I just conquered. It would be better if they revived in a city far from enemy troops (if possible) so I am not flame darting their sorry 3-5 hp butts back to the next nearest city.
There are a lot of fun things to try with sov\hero deaths:
If there was a golem master trait: let my sov's spirit animate an obsidian golem with magic immunity, but the sov can't cast tactical spells, and only up to lvl 2 strategic spells. Or a beast master could be trapped in a cave bear's body etc with similar results until a special spell is quested for or researched.
Dead heroes could spawn specific quests to restore them.
Perhaps an item the character was wearing becomes imbued with the essence of the hero wielding it: "The Shield of Oleric is a holy relic of the mighty warrior who fell defending the Village of Woods Edge from hordes of (i.e. 3 stacks) of enemy forces. Use it to safeguard your people."
Give it the same stats as the fallen hero in regards to Dodge, Init, and one hero-specific combat ability (Crushing Blow, etc.)
A quest or spell as above could let you "convert" the item back to the hero or if you prefer the item created for them, well, you will polish Oleric to a bright sheen every night 