And everyone will call you THIEF instead of whatever name you entered for the rest of the game.

He'll kill you if you successfully steal and come back after. He'll stop you if you are too slow on your attempt.

If the shopkeep is strong enough to just instantly body the hero, why isn't the 'hero' selling swords while the shopkeep goes to manhandle the Demon Lord a little??

I don't think you are wrong in my own context, but in areas with essentially no hope of recovering from a life-altering theft, I can see it. In medieval times, right up to the modern era, where state police that (ostensibly) serve everyone were actually instituted, policing was essentially a private service. It was on the individual and whatever posse they could muster to get their stuff back.

For me it's one of those situations where I don't agree, but I understand. Not for basic goods obviously, but I won't shed many tears if someone gets killed while trying to steal someones phone/car/bike/etc. Like, look at Brasil. Are you saying it's pathetic for someone to shoot a thief who just jumped off a motorcycle and tried to snatch their purse?

I just feel the more pathetic of the parties is the one trying to steal.

it's not about the act of killing for revenge or anything.

It's about making future threats credible.