DragonLancer said:I went for the first option. Its always been part of the concept of the paladin class that they walk a narrow path, and its a roleplay path. Heroic gaming.
I agree. I have played paladins under several GMs and we have always worked with the understanding that the loss of powers is not just a result of poor behavior on the paladin's part (someone who deliberately broke rules under which they agreed to live shouldn't be playing a paladin anyway), but often a result of the paladin's realization that they have strayed from the narrow path they have chosen. The loss of faith in themselves denies them access to their abilities until they feel have atoned for the damage they caused.
I also see the presentation of opportunities to lose powers as great chances to roleplay and be truly heroic - I watched a paladin defend a runaway slave in a slave-holding state ...everyone laughed later because we all realized that before our eyes he grew a big red fluttering cape from his shoulders and a huge S on his chest, even though in game he became an outlaw with a price on his head in that city. The chance to be heroic, even in our imaginations, is rare and players who want the chance should have it. Being truly good doesn't mean much without a chance to stand against true evil, and that stance means even less if there aren't consequences for the choices you make.