Of course, a few nay-sayers are going to come crawling out at this suggestion - and for good reason, because one really annoying thing in the game is people suiciding themselves to return as fresh-spawn to get their lost gear.
But the fact is that you can't simply magically make items disappear. You can not just wave your magic wand and say "CORPUS DEFLUO!" and a dead body will disappear with all the stuff on it.
If you really want to hide somebody's gun or backpack, you will have to pick it up and toss it into a river or carry it far away to place it between some shrubs (which, in turn, forces you to risk having somebody else steal your stuff that's lying around). Or you could bury it (another good reason to carry a spade or shovel)
Same counts for "skin and quarter body" on players. Apart from creating a big, bloody puddle, this should not cause gear to disappear.
I would suggest ruined gear also not disappear until at least two or three server resets.
This would also make it easier for freshies to find some decent loot!!!
But beyond all the good reasons, it is simply logical.