Hate it, for sure. There's nothing more detrimental (outside of glitches) to immersion than raiding a Stormcloak camp in the name of the Empire and putting everyone to the sword, only to have to awkwardly "retreat" after putting down the commanding officer for the fifth time. I mean, at least make it so I can arrest them if they're part of a rival faction to the one I chose. I much preferred the mechanic if Fallout: New Vegas, where everyone can be killed. Yeah, you fail quests, but that's part of it. If you want to kill everyone in a town, that's the sacrifice you're making, and nobody goes into it not knowing it, so this system feels like adding a railing to keep me from falling off of my couch. Not helpful, and not fun.
Well, they are in more danger from my murdering thieving Kajhit :P I love the idea that I can kill NPCs and alter the story, but I also don't want to find that I can't complete a quest (not so bothered about side quests, but the core quests). Ideally there would be alternative storylines, alternative NPCs etc to step in.
I don't really have a problem with some Essential like the assassins but their are some I want to kill like the blades so at the same time I don't really like it they can get in the way of many things. Fallout 3 did this with some dumb npcs that I want to kill but I can't. Anyways I like it but hate it at the same time.