Yeah, players hate recurring villains. As cool as they are from a GM's perspective, players just go, "wonderful. There's this guy with evil intent, tons of resources, and now he's going to strike when we least expect it. And we'll have to take it, because we don't (or can't) bring the fight to him."
I was playing a VtM game a thousand years ago, when my character was attacked by a vampiric contract killer. His Clan was known for being methodical and fanatical about taking out their targets. When I managed to defend myself, he tried to run away.
I used an ability I had that let me attack him, even though I could no longer see him, and basically turned him into smoldering ash. The Storyteller threw a fit, and ended the game right there, asking me if it was really necessary to "power game" his NPC and end his story right there.
"If your story is to threaten me with Destruction, and then have my enemy run away to try again, when I might not get so lucky to defend myself, then maybe I should just hand you my character sheet."
What we both, at that time, failed to see, was he was trying to tell an interesting story, and I thought he was trying to kill my character unfairly. Trust is an important issue here- if you can't trust the person running the game, you probably shouldn't be playing in it.
But by the same token, trust, once lost, will never be regained, so you need to be very clear with your players what you are up.
If you'll indulge me, I'd like to share another story. My friend Garrett invited me to his house to play D&D with his group. We used to play a lot back in the day, but he now lived an hour away. I was having fun, but then during the third session, we were in town, and we split apart to investigate various things. One by one, he pulled groups into another room for like an hour at a time. The players would come back and not talk about what happened, but they were grinning like fools.
Then it was our turn. Mysterious armed men appeared in our path and tried to take us out. I dropped a Fog Cloud and ran like hell, using Invisibility (I was a Trickery Cleric). Then I, along with our party Wizard, cobbled together some disguises, and ran for the one place we believed was safe- the tower of our Wizard ally. We were 4th level, by the way.
As we evaded the armed men, a Wizard tried to hit my ally with Enervation, a spell that had a 25% chance to instantly kill him! But that didn't happen, and we escaped.
The other players looked OUTRAGED. This whole escapade took two hours. Garrett admitted that his whole plan was to kill all the PC's, then begin an adventure in the afterlife. Rather than just tell us this, he went through this whole scenario, which I "ruined" by refusing to die.
Now he said he'd have to completely change his campaign. I looked at the Wizard player (who was my ride) and said "I have a better solution. We won't be coming back next weekend." And we left.
If the DM had trusted us, his players, it wouldn't have gone down like that, but instead, he decided to try and railroad us, then act like it was somehow "our fault" that he failed.