Thus meaning everyone is rambo and everyone fights to the death. Which is a "problem" in all mods. For example you would be surrounded by twenty men and your the last on your team for some reason, in Warband you would fight to the death while really the player himself would surrender when put in that situation. (So in gameplay terms, a player who surrendered and didn't come back basicly wouldn't count as alive in the player list)
But yeah its your call. Morale for horses sound interesting, what were your thoughts on that?