Oh there's penalties to said behavior as well. 5 murder counts and you go red. Reds can't go into towns. They are free kills for everyone else and when they die, they take a major statloss penalty which takes them from hero to scrub instantly.
Sure, it can be a drag getting PK'd but it is the kind of game that makes you aware of yourself. There's danger everywhere. Mobs, even with a powerful toon can kick your butt just fine. Other players can attack you or ransom you on sight. It's a game that rewards diligence and skill... It's not a game for the faint of heart.
In very simple terms...it is UO pre-Trammel. If you liked Felucca, you'll like MO. If you liked Trammel, you'll hate MO. If you like EVE, you'll like MO... if you love WoW and play on PvE servers... you'll hate MO.