While we’re on the subject of Fear in RPGs, the Rust Monster represents a particularly pure instance of Challenge Fear. The only threat that the Rust Monster represents is to your character’s efficacy. An encounter with a Rust Monster challenges you to avoid or defeat it without risking your precious equipment, or to face subsequent encounters at less than full strength.
Players who think that isn’t fun are wusses. Or, to put it slightly less pejoratively, are either seeking the illusion of challenge without the actual possibility of significant set-backs or shouldn’t be playing a challenge-based game. Players who are interested in interacting with the world will roll with the punches: if that’s what the setting says happens, that’s what happens. Players who are interested in creating an exciting story might actually seek those situations out: if John McClane has to run through broken glass in his bare feet, putting him at a disadvantage for the rest of the story-line, that’s great, it ups the tension. Players who are genuinely interested in challenge might curse their luck, or their lack of foresight, but those are the breaks that make the game worth playing. But players who complain that it’ll leave them at less than their recommended wealth-and-equipment amounts for characters of their level, throwing off the challenge ratings for level-appropriate encounters until the GM throws in enough loot to restore the balance…. well, I can’t help feeling that they’re playing not just the wrong system, but the wrong kind of system.
There are plenty of systems out there that are explicitly built around the notion that the PCs will triumph and kick ass, and play is about giving them the mechanics to describe how they kick ass in really cool and awesome ways (Feng Shui and Exalted come to mind, or in a different vein something like Amber). Taking a system that in its essence is about all kinds of ways that PCs can fail (poisoned, turned to stone, level-drained, killed, polymorphed, etc.) and putting foam padding on all the dangerous bits is…lame. Go too far in that direction and even sword wounds will just seal themselves right up after a few moments… oh, wait, that’s 4e Healing Surges.
Really, I can understand and enjoy styles of gaming where the only setbacks are player imposed or player veto-able. But if players want that, they shouldn’t fool themselves about what they’re doing. If losing your +2 Flaming Broadsword is going to ruin the campaign for you, getting rid of the Rust Monster isn’t nearly enough–the GM’ll have to get rid of thieves, Dispell Magic, really any kind of situation where you could be knocked unconscious and stripped of your possessions… You’d all be much better off with a system where having that flaming broadsword is part of your character schtick, with explicit script immunity.