I don't even know how this current line of debate started. How does this all relate to Patrick Weekes' post about the healing system, which, btw, I fould extremely useful and would rather see discussed than the side issues we've been distracted by.
@Bfler:
The stated reason for non-regenerating health, taking regular healing spells out of the game and limiting the number of potions is that the potentially unlimited hitpoints people were carrying about made it necessary for every fight to threaten you with a party wipe if it was to be interesting at all. Fights were also much harder to balance. I find this convincing. Now you can have, say, fights with low-level bandits be realistically easy for your epic hero and still mean something. It goes hand in hand with the unleveled world. I say it's an improvement, even though it might need some more balancing.
Also, Medhia Nox posted a list of ten ways to recover health. Healing isn't restricted as much as some people believe.