Currently, the hot debate in the UO Dev circles is whether or not to eliminate stat loss in the PvP+ lands in the upcoming Felluca/Trammel thingie.  Personally, I would hope that Anti-PK groups alone would be enough to stop PKs and keep non-combatants, it seems to work on Siege.  With the introduction of the PvP- lands, IMHO, I think that stat loss should be removed completely.  After seeing Lum's poll, I realized that many, many players don't agree.
As longtime Anti and a player on Siege Perilous, the only shard with no stat loss, I'd like to bring up an idea.  Let's go over a few facts here:
1)  Murderers need to be punished in some way for their deeds.
2)  Permanent stat loss is too harsh a punishment for a game.
Many might are argue that loss of town privileges alone is a big enough punishment for murders, on an advanced shard like Siege, that's all we ready need.  Everyone is fine with that system on Siege.  I can understand how others feel that harsher punishment is needed.  Many players just want to be a merchant and not worry about things like combat.  
Permanent stat loss is not the answer either.  Ultima is a place where players are given the ability to shape the world more than in any other MMORPG.  Taking 20% statloss on GM level skills is simply too harsh.  Let's be generous and say that an unfortunate victim loses 5,000 gold to a PK.  How long does recovery take?  A night focused on gold making?  Let's say a PK dies and gets stat lossed from 100 magery to 80.  You are talking about weeks to recover from the death.  It is simply too harsh.
The solution?  Taking a hint from Asheron Call's vitae penalty, the solution is simple, TEMPORARY skill loss.  We can argue about the details, but the idea is simple.  If you are a PK and get killed, you take a temporary loss of stats.  After some amount of time, your skills return.  The idea is to put a damper on the endless killing from the days of the Dread Lords.  
My initial idea would be a that your temp stat loss is equal to your short term murder count, capped at 20%.  So if you have 10 murders on your count you take 10% loss.  If you decide to be mass murderer, you'll take 20%. 
Recovery of stats is probably up to discussion.  I would suggest that stat loss is reduced by 5% once a day.  No need to sit online waiting it out, make it an automatic change.  Consider that it would take a 20+ kill PK four days to fully recover.  If you can't agree that taking four days to recover is a harsh enough penalty, you need to consider joining a MMORPG with a complete ban on PvP combat.  
Well, what do you all think?