Just so you guys know, I haven't ever finished ToEE and I will be playing Ironman, I can't remember if you can reroll in ToEE for dead characters etc... I assume that you can, but I'm not certain.
Anyways, should an Obsidianite die, provided that they can be replaced, they'll be replaced with the next in the queue so to speak. Else I'll probably go with party rerolls, but worry not I shall generate all the characters before I start, it's a quick enough process on Ironman, as you HAVE to take the first roll.