Lanefan
Victoria Rules
I do a "floor level" model, largely because of a bad experience with the method you use. Example of what happened: a party of 5th-levels lose a character. Replacement comes in at 4th. A while later, party lose another 5th - thus by the rule the replacement comes in at 3rd because the 4th-level guy has set the bar lower. Lather rinse repeat - I had a party go backward several levels once until I finally just put a floor on it.I believe being intentional about lethality is a helpful tool for a DM. It is not so much that one can say what the chance of death per encounter should be, but more - as you describe - that one can be mindful of overall death rates.
I tracked (in my campaigns, and against anecdotes from other DMs) and then calibrated toward party+level characters being needed to have party-characters survive to that level. With a 50% revival rate (i.e. only half of deaths turn out to be permanent). Note that in my campaign, replacement characters are generated at the bottom of the level below that of the lowest levelled survivor.
Now what I do is that as the average level of the party increases the floor increases with it, such that if the party are all 5th level the floor where all replacements come in might be at 4th, to prevent the backslide.
Another factor to consider is intended length of campaign. Planning for an 8-month 6-adventure no-deviations path is going to be much different than planning for a 5+-year open-ended sandbox-style campaign.For example, for a party of 4 in a campaign that will cap out at level 12, up to 16 characters will need to be generated. A dozen will die permanently, and there will be about the same number of non-permanent deaths (i.e. revivals using raise dead or similar).
Part of what this is addressing is the matter of tolerance, and the feeling of danger. I find players will tolerate that degree of mortality, and it inspires a decent sense of danger. Tolerance no doubt varies per player as normalised by their group. By which I mean that Jill could be more okay about losing characters than Jack, and both their feelings on the matter are influenced by their group.