They should definitely stick to Sierra rules (with an auto-replay feature via prompt after deaths [preferably with an option to restore a saved game in the prompt as well] - that should please both modern adventure gamers and Sierra loyalists, because the fans in the latter category can easily restore a game from that point instead of auto-continuing).
They've already mentioned they're going to have deaths, so I'm not too worried about that point.
The only thing I think they should avoid with this new King's Quest is dead ends and arbitrary deaths (by that I mean stick to tense situation deaths like in Gabriel Knight or the first two Broken Sword games and deaths that are foreshadowed like going out in dangerous places are OK too [when you're warned how dangerous it is either by a character, the narrator, or even just by sight and/or sound]), but stay away from deaths that aren't obvious or foreshadowed). Sierra was already phasing those things out, and those are definitely two things that Telltale shouldn't bring back.