If it helps, try not to think of "death" as the only suitable punishment. That's the mental workaround here, I guess.
It's a matter of disagreeing directly with Alistair at the Landsmeet. He thinks being a Warden is an honor, not a punishment. This is the point where your opinions on the Wardens come to a head. Is it an honor or a punishment? Personally, I hate the Wardens. It's a punishment. It all depends on where your characters' origins are though, and what they lost because of the Wardens. Or what they gained.
I don't even think it's so much a matter of if it is an honor or a punishment. Alistair saw it as an honor. But he's a very sheltered and naive SOB. Much as I love him, this is one glaring fault he has. Blind stupidity when it comes to the wardens. So desperate to not be a templar (because he didn't want to kill mages after that one harrowing he attended where they killed the mage with a demon in her) that this is far more appealing to him. He instills it with some sort of romanticized honor - the fabled grey wardens, heroes and great warriors (because he cannot face the horror of it which in the fade, in his 'dream' you learn that it is something that is far from his ideal and no honor by any stretch of the imagination). Too horrified to face the reality that he probably would have been taken by Duncan whether he liked it or not he lives this lie that he tells to himself. It doesn't even occur to him that the 'cutpurse' was basically conscripted because he robbed the wrong person or he just doesn't want to or cannot admit it. That this didn't even make him wonder just a little bit... that what Riordan says at the landsmeet if you hit the right dialogue and he speaks of them being murderers and theives, etc... I really wonder if there was some sort of undercurrent of dislike for alistair when they wrote him because to make someone so idiotically naive or deep in denial... my god. It's kind of horrendous. But really it's just one more case where the character, Alistair, ever the tool of the writers, behaves to suit their needs rather than being a reasonable and fairly intelligent character.
These days when I play, my characters are a bit darker on the wardens. They're all wise and a bit cocky now. First games they were more naive and honorable. They've evolved quite a bit. Now they all seem to be channeling my current thoughts and feelings on the wardens which is that they are on hole a necessary evil. Yes. Evil. What they do to people, how they lie to them, how they make opportunistic grabs, stealing people from their lives at what in many cases is the worst possible moment and you end up having to make the best of a pretty crappy deal thanks to Alistair's good buddy Duncan... well, it's some nasty stuff. My wardens now, never stay with the wardens unless I choose to romance alistair and we choose to stay after the blight because anything will be easier. Otherwise they say 'FU' and run off after doing their job.
I don't know who I feel worse for... the ones who become wardens around the blight or the ones who literally waste their lives in between blights... all those generations of people stuck with this taint and crappy existence of nightmares and slowly turning into a ghoul, and for what? To stand guard awaiting the next round of hell.
Letting Loghain become a warden to me serves one purpose.... it allows alistair to live and loghain's death to be of use, mainly in saving me and if I make loghain a warden then also saving virgin Alistair from losing it to Morrigan. Ewww. If my character has disliked Alistair for being nasty and having angry outbursts then sticking him with Anora and letting loghain join the wardens is fun. If I am meh on him, I don't care either way. If I have romance him or he is a friend, Alistair gets his revenge. I think this point in the landsmeet with loghain has far more to do with how you feel about alistair in that roleplay than it ever has to do with Loghain, which is I think the real point behind it. Probably why they made Alistair so easily disliked for certain people and characters.