You can avoid death by dropping the Fugue Robe.
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Most of the death scripts are tied to having the death robe on your inventory. Since you drop it and restart the server, you are no longer dead.
Either can change that to set a token at the player and use said token to TP to fugue, or make the item undropable (even though players with full inventory won't receive the robe).
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You arent supposed to be able to drop anything in the fugue.
I read a dozen fugue/death related scripts and I cant find the issue.
Feel free to take a stab at it -
You can no longer drop the Fugue Robe but other items can still be dropped.