Well, I'd say if you kill someone in a public place, there is most likely someone, who witnesses the act. Townsfolk inside their houses, looking down the street through the window for example. In the wilderness though, or somewhere where there isn't a soul within a certain radius, a murder could easily go undiscovered. But a kill in a public place could be seen by someone all the time. Actually I'd like to have 'public' and 'secret' areas within a town. Anyone who ever hit /unstick knows, that there are sectors in each map, so to realize the idea, these sectors would need to be determined secret or public in the code, so the system knows, whether a murder was unseen by the townsfolk, or not. I, however, don't think some NPC could actually report someone to a guard, but more to this in the last passage.
Now to the other form of witness, the players. Players could report a murder. All they need to do is to be in a close position to the act. When you get a system message saying 'Player A has been killed by Player B', you have sort of witnessed it and could run to a guard. But in order to make it more realistic, the sentence 'Player A has been killed by Player B' should only be given, if you have really seen the act of killing, when you had clear sight on the killer. If you are only close to the murder, you should get something like 'You hear the blood-curdling scream of a {gender} [race]'. That way, after you decided to take a look, you don't really know if the hooded person above the dead body is the killer or not. So you cannot accuse someone for something he didn't do.
However, the biggest problem with reporting someone to the guards to put a bounty on his head, is that you have to know the person, or at least his name. And as far as I can tell, the only way to have a bounty system without hurting RP, is by implementing what was discussed
here. Beeing introduced to a character is neccessary to know his name, and in my humble opinion it would not only be a great feature anyway, but also delete one big OOC aspect of the game and help forwarding IC gameplay, just like bounties.
Sorry for going off topic so much. But with the new possibility to spare someone's life, a murder becomes much more meaningful from a game mechanic's point of view, and bounties match just perfectly with the whole story.