Wouldn't it be cooler if you were thrown in the nether when you died and had to fight your way out to get back or something? Would work well with multiplayer, would be very punishing (might have to be made easier, actually).
The nether could do with a bit more stuff happening, a bit more useful resources, usable resources. You should be able to stay, and survive, find food, find tools, just make it much harder.
And that could work with multiplayer too. If someone dies they go hell-side, and then put in scrying pools, through which they can possess zombies, or other enemies, and if they kill a player, or lots of enemies, or whatever, they can gather the energy needed to travel back to the real world.