Whenever considering ideas like these it helps to imagine how Brian Van Hoose from KODT would deal with them.
Close your eyes and think about awarding XP for damage taken then imagine Brian playing in such a game.
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Agreed. Even if your players aren't the type to deliberately abuse the system, the incentives you set up will influence their behavior. Fights are apt to get longer and grindier. New feat and power choices will shift toward the defensive, making fights even longer and even grindier.
The only way I could see this approach working would be in a system where PCs have few hit points and a single hit's worth of damage can easily mean the difference between life and death, even in a seemingly "trivial" encounter. That would provide a powerful disincentive to balance out the XP mechanic. 4E is about as far from that system as I've ever seen. Previous editions of D&D are closer, but still not close enough IMO.
One of the reasons I ditched the XP-for-kills mechanic long ago is that it pushes PCs to act in weird ways. This system would have a similar effect.
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