I'm kinda glad there's no locational damage, or wounding or any of that. I don't know about you guys, but I feel kinda boss when my character is marching toward a bandit with an arrow through his neck. c:
Everything is simplified and that makes for more fun, and less hassle. If you're asking for things to die when they have an arrow lodged into their face, it's only fair that the same can happen to you (which would svck for me because I get shot in the face, A LOT).
And if it's realism you want, doesn't that mean that bandits swinging at you should be a one/two shot kill? Getting set on fire by a Redguard should be a near instakill? Mages electrifying you would pretty much char you if you're wearing heavy/metal armor? All of that would svck, and would take me out of the realm of an epic, fantastical RPG, and make me feel like I'm just another peasant trying to survive, which doesn't make sense because I'm Dragonborn, damn it.
That is the question. Do you want an arcade kind of game or a simulation kind of game? What kind of player is the developer trying to please the most? It's true that some people are just looking for a simple and fun game, like Doom or any pinball game. However, I'd argue that most people that play this particular game are looking for immersion, where suspension of disbelief is important. The better a game simulates the behavior of the world it's trying to create, the more immersive the experience is. If I put an arrow through someone's brain and he continues to move forward, I'm pulled from the simulation into the arcade aspect of the game which breaks the immersion.
Now, more realism doesn't necessarily mean more hassle, if it's done right. I agree with you when you say that the same should happen to you but of course, that wouldn't be fun, I get arrows to the head all the time. However, I think this only makes another arcade aspect of this game more obvious: it should be harder to hit a moving target, specially in the head. Plus, as JerTob said, the actual algorithm should be more complex and taking other things into account. Maybe blocking or other kinds of magic would become more important to protect yourself from arrows or other stuff.
The point is, if the game is designed with that in mind, it shouldn't be any easier or harder, just more immersive. Of course, this requires more work from the developer than a pinball game...