I think there are probably lots of ways a User could die in the Encom system.

I mean, I do personally lean towards the interpretation that Kevin Flynn survived the end of the 1982 movie because, as a User, any “death” he experienced inside the computer would just rezz him back out into the User world.

However, I recognize that there isn’t a lot of canon evidence for this interpretation…. and I do think there are limits on it, even in my own headcanon.

For example, it really seems that the MCP intended for Flynn to eventually die in battle, when it digitized him in there. That’s what the MCP said to Sark at the beginning, anyway. So…. for my own purposes, I imagine that the MCP had something set up to block the laser from successfully sending Flynn back out in the event of his derezzing.

And the only reason that block didn’t work, is because the MCP was severely distracted and actively being destroyed while Flynn jumped into it.

Apart from deliberate blocks like that, I think it’s also pretty clear that the laser being destroyed, damaged or disconnected in any way could have a similar effect, causing a User to derezz for real instead of being sent out.

And yeah, I’m sure there are also ways of corrupting a User’s code in-system to the point that it can no longer viably be translated back into User-world matter.