I do like the idea of a bloodied condition that makes you fight harder when your back is up against the wall. If it mitigates the death spiral, I could really get behind it. I love the idea of a unified condition track, it's just the tied to hit points part that I don't enjoy.
If there were a sidebar that explained how to untie conditions and hit points, that'd rock. Built-in customization options are the bomb. I'm not a simulationist (I just wanna have fun!), but I'll not begrudge them their jollies.
-blarg