In a world where the Gods aren't really Gods at all...

[Kahuna Burger]

Chuckle. You could certainly go that route, but then you'll need to decide how spells like Raise Dead and Reincarnate work, if they even exist.

How do they work now?

On about 30 seconds of thought, the spells are a combination of divination and transmutation magics which restore the body to the last point of brain activity (and then stabilize them).

 

[Kahuna Burger]

...or do they plunge the world into a godless anarchy.

Is the world as you currently envision it a theocracy? Or under constant threat of undead invasion? I'm not seeing the default anarchy if all other magic remains the same. (Though you seem to be going for a cosmology in which Divine Magic is a special kind of energy which will simply cease to exist without these beings.)

After having read Sisters of the Raven and Circle of the Moon by Barbara Hambly, my instinct would not be for a sudden catostrophic failure of magic (which would be odd if they are channeling arcane magic into all the divine energy that druids, rangers, etc use as well) but for a fading of the powers of some classes as others emerge. The world would become a changing landscape, politically, religiously and magically. (And a dangerous landscape geographicly, as century old bindings that were placed with the "old" type of magic unravel before the practitioners of the "new magic" have figured things out well enough to know how to replace them.)

The best way to do that actually would be to start out with a world with no arcane magic, as the aliens couldn't work with it and thus found all the ley lines power sources and put converters on them. When the ancients are freed, their converters break down and over the course of a generation, the power of divine magic is gone* and arcane powers are emerging.

*gone, unless someone is daring (read : insane) enough to find a way to do small scale conversions themselves....

You know, I've been thinking of how to do a magic transition game since I read those books, and now I may adapt this to give a background for it. Though instead of aliens, I'd probably have powerful outsiders bound "for a thousand generations" by ancient mages who thought that was forever.... sucks to be the thousand and first generation when forever runs out.

 

[zen_hydra]

Chuckle. You could certainly go that route, but then you'll need to decide how spells like Raise Dead and Reincarnate work, if they even exist.

How about taking a page from Paranoia and having resurrections summon a clone pod.

...or more seriously, magical nanobots repair damage and resuscitate dead characters. If you don't go into to many details about how "magic" works, then you never have to worry about pesky metaphysical concepts like souls.

 

[TerraDave]

Its good. Just do it.

 

[Rogue765]

How do they work now?

On about 30 seconds of thought, the spells are a combination of divination and transmutation magics which restore the body to the last point of brain activity (and then stabilize them).

Reboot. REBOOT!!

 

[Varianor Abroad]

I found problems with the "gods aren't quite gods" campaign in the place you might expect: in character for paladins and clerics. The PCs (despite hints before the game started) in character were not prepared to find out that their gods were...less than gods frankly. However, it's made for some excellent roleplaying. No issues with the mechanics at all. (And I am using Monte Cook's Requiem for a God for a lot of background material and options.)