The explosions thing is a lazy game design mechanic introduced by gregoriousT and kept because its tradition and because it's too much work to implement a different penalty mechanic.
A lot of gamers will suggest it should stay because they're l33+ and want to feel like they're more hardcore than everyone else. That's cute and fine. But more realistically, any mechanic that strongly encourages players to reload a save game in minecraft is just dumb from a game design perspective.
If I overload a machine, its not altogether terrible if that machine is lost. Lesson learned. But the scope of the lesson should be confined to that machine and not everything else around it.
And: yes, yes, all you super awesome hardcore players, you're all very super special. No, I don't care.