Well as far as I know nothing happens when you die to a red, just like a duel on this server.
I wasn't talking about adding in any code or changing the game, but just creating a red guild with the current rules. It would be interesting to have a guild pledge loyalty that way - cause they would have no alternative. Would be a fun alt guild to be a part of. Guild events pvping against each other could be pretty fun. There are other things I am interested in like raiding and expansions to come, just saying it would be a fun alt guild to play around with. I doubt the guild would ever grow or be dedicated enough to dominate pve as well... but who knows.
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