Did I understand the point of killing the players?

Imo item drops is not the main goal of pvp. I think that mainly because flagging up decreases the amount of the stuff you'll drop on death. If Steven wanted everyone to just farm each other for mats, I doubt he'd go with that kind of design.

As I see it, pvp is there to just compete for the sources of those mats, be it mobs, bosses, quests or gatherables. If you get some mats from the dead player - great, that's a bonus, but I don't see it being the main goal.

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And the goal would still not be the "I want that person's items/mats".

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Yes, the game does in fact have group-based design. But even groups won't save their PKer from the BH, because they'd have to go red to do so, at which point it would just become an endless downward spiral of PKers, who will all die sooner or later. The people will still PK or at the very least flag up against others, both in a party situation and solo.

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Yeah, that's true, but I'd imagine that this kind of behavior would quickly turn into a good ol' guild war or just an all-out brawl with several BHs or passerby groups. And the BHs themselves might have a healer for these exact situations.

Either way, I really hope that Intrepid stick with the BH idea and, ideally, even expand it.