Full PVP is fine, you just need very harsh penalties for doing it. You get marked if you initiate and PK a single player, and then if you go anywhere near a civilized area a big burly guard comes and... beats you to an inch of your life, at which point you are put in jail and sentenced to something worse than death... a loss of stats! The loss of stats is equal to the difference between your character and the character you killed, with a minimum of 10-20% of your stats. This makes newb killing a lethal offense, as you would basically be reset. This makes it difficult to go out and reoffend, since you will be weaker.
Oh and since you are marked you can\'t go anywhere near a town to resupply or rest or get equipment, or any other thing you will need to do. Also players will either stay away from you, or if they want can freely attack you and turn you in for a bounty. All they have to do to turn you in is too severely wound you, whereas you would obviously have to kill them to win.
If you tried to continue killing people, the word would get around and stronger players would show up to kick your arse. Perhaps even allow multiple players attacking you at once. So basically someone who pk\'ed would best turn themselves in right away, or try and go into hiding while people hunt them. Given\' the dev\'s aversion to teleporting and other forms of instant transportation, hunting someone down would probably be a fair deal. And if you pk multiple people the sentence can even turn into a time-ban or maybe even perma-death, even though the devs hate that. I already posted this idea more or less elsewhere, but I fleshed out the sentencing ideas here a little more.
Freedom to be able to do anything is important I think, but once you start infringing on other people\'s freedom\'s, just as in real life, there will be severe consequences. I want to know if there are any loopholes in this system, aside from the fact it would need to be thoroughly, not gradualy implemented, and in the meantime PK should not exist outside of guild wars and arenas and consensual PvP.