Dammit you guys! I JUST started an EA game, and now you've got me all curious to try Kailasa.
Maybe I'll do some SP tinkering to work it out.....
Was just playing with pretenders a bit - I do think N4 is pretty useful for Kailasa. Though, I suppose you could just plan to mass buff with Ethereal/Luck by the time it really matters.
Also, their recruitable anywhere sacred, is not the archer, so this somewhat complicates the issue. While I'd agree that the Death bless is still very viable for them, the fact that most of your sacreds would be full time melee, kind of changes the rest. I was looking at a Master Lich with 6A/9D/4N which seemed pretty viable as far as retaining decent scales as well.
However, overall it seems like you are best off trying to use blockers to eat arrows. That being the case, the Air could be dropped altogether, to give them a bigger Nature bless which could be enough to keep the archers up (you should have at least some protective buffing going on before things get really hairy), and also provide a lot more benefit to the melee.
Okay, I'm getting carried away! To sum up, yes I agree that Kailasa is a good example of Death potentially being better than Fire.