But God created us with an inability to live sinless lives. So it seems we all deserve death because our creator designed us that way, but we should praise His mercy when he doesn't choose to take our lives on any given day.
It's like saying to an ant "You deserve death because I don't like how you must live....crawling around, eating the picnic scraps, but I'm not going to squish you today because I'm in a nice mood".
There's got to be some way to reconcile a loving God with the idea that He created us destined for death and eternal suffering unless He chooses to intervene through Jesus or the Holy Spirit, perhaps by bestowing the gift of faith. I don't see it yet, though, how to reconcile the two.