I quite enjoy permadeath in fire emblem, even with that sinking feeling when a favorite character dies and it's all your fault Or maybe because of it, that drama immersing you more in the game.
But it's good that they're putting in a option to turn it off. Permadeath doesn't mean anything if you're not willing to play by those rules, which is to say, you keep resetting. Then all you're doing is frustrating the hell out of the player.
There should still be some deterrent though, probably a financial one, so you don't try to cheese your way through with not so suicidal suicide tactics.