Let me get this out first: no open PvP, please. Regardless of how it is done, it will lead to griefers and lots of abuse.
Heck, even our PvP confirmation system is being abused already!
Let\'s face it, thieving / asassinating are for good RPers only, because they can handle both sides. Everyone else would not be likely to take it nonpersonal, and that\'s the majority.
As for the etiquette: I am very very tired of people challenging everyone everywhere, especially because more often than not, it is either newbies who challenge or who are challenged.
The latter is the worst problem, because
1) The newbie doesn\'t know what a duel is about, he most likely doesn\'t know that it ends with death. If someone asks for a duel without any dispute, I would expect it to be sparring, not a fight to death. Therefore, they are quite right in accusing you as murderer.
2) Yes, they could (and should) decline, but you\'d think that paople only pick opponents that they think are worthy (i.e., not much more inexperienced than oneself).
3) Furthermore, they cannot know if it is expected that one accepts a challenge!
The first still is a major annoyance. The presence of the quickbutton \"challenge\" makes it look like this is encouraged and a normal thing to do, like the \"greet\" quickbutton. While the latter is, the first is not, and thus newbies get the wrong impression and expectation.
The first thing I did when entering was to turn on auto-decline, but that was possible only because I had read about the duelling problems before, which is something newbies cannot be expected to have.
As for the IC duelling: yes, this is another problem. RPers get challenged for non-RP purposes and accept for IC purposes. Hence, RPers are at a disadvantage which takes away from RP, and thus this is a bad thing. Hence, I specifically turn on \"ask every time\" after I have agreed to an IC duel, and turn it back to auto decline afterwards.
A good RPer will be able to play along after getting a /tell like this \"OOC: I\'m an asassin and you look like prey, would you agree to a duel?\"
The ones who will then accetp are the only ones who may be able to handle it, anyway.
@ Xordan: The problem is that I have seen people challenge without holding any weapon, only to click a quickbutton (equip swords, attack) after the duel has been accepted. Even if not, the skill level makes the difference, not the weapon, and since weapons seem to be given out in great quantities to newbies, it isn\'t a real way to judge actual strength by.

That and the problems that have been pointed out already.