One can think of it as a more action/adventure orientated .hack setting, where the focus will be more on survival and exploration of the epic castle of Aincrad slowly working towards the lofty goal of clearing floor 100 to escape back to the real world. I don't see why a player couldn't roll a new character if their first or second dies of course, because why not?
Right now I'm undecided on whether this should be completely freeform, implement an unobtrusive system that simply keeps players from power creeping, or homebrew an original system altogether to deal with the fast paced action of SAO battles.
As for plot I'm leaning towards a very low level start near the beginning of the series, on floors 3-25 to begin with. The players either form a party of friends that know each other in RL (everyone's avatars looks just like their real selves, making this easier) or they are desperate new recruits drafted into the ranks of the Aincrad Liberation Front, or the Army, which is a massive guild set up to organize the chaos that erupts after so many people die in the first few weeks.