We've been there with the death issue, much like you Kriston. Its such a tough topic to tackle, especially when you're talking to a 5 year old. (thats when L was obsessed with it).
Incog, I think you handled it perfectly. I think the best thing for these kids, at least this is my opinion, is that when they ask about things like death or cloning or terrorists, that we answer them with honesty. Of course we can always be sensitive to their fears and concerns but for me just going ahead and talking with dd about issues helps her to work through it and ease her mind. I'm finding that sugar coating things insults my dd. She'd rather have the truth. Of course, not all kids are like this but this has been my experience.