I suppose Wii games are out of question here. MK i stated as one OOQ aswell, and with it Virtua Fighter is too. These are simple fightning games; bash keys until the enemy is dead and try to blow up a combo. Also they are more of 2D experience than 3D.
You see, I dont like combat system when you have two keys, bash and block. Nor do I like combat system when you have to use half of your keyboard. Also a system thats totally passive, like in RPGs, when you press "1" on your keyboard, which translates to "do a super trick" and then just watch.
Quite a good system boasts the before-mentioned OJP. You cannot die by an accident; if you do not press anything and you get hit, you block it (unless its a hit from behind). There are combined DP and FP meters that do great job in architecturing the fight; one duelist unleashes a series of attacks, its blocked by other side, the other side runs out of DP and attacker is running low on FP; so the sides swap, defender shifts to attacking and vice-versa. To actually win a fight, you must exploit a weakness, force the enemy into a mistake or somehow break the chain.
Some duels can get awfully long and that is what I like. It only gets somehow dull after a while though; and also the mod is still buggy (and will be for a while). Could be solved by the uniquness and a battalion of moves, before-mentioned.
If not done by a small community of mod makers but by a serious company, this system looks really promising. It might get done in years even by the small community, but it will take a long time; and the guys are limited by their engine of Jedi academy.
Games like PoP or Assasins Creed do good job in having the fights look nice and fluent; but they both lack multiplayer and also it sometimes makes enemies too easy to kill. The point of a duel is actual struggle between the two...struggle to even get a hit on oponnent. Not bash him like a nail until he runs out of HP. Blocking is essential, but once you have block, you shouldnt forget dodge. Once you have block, you shouldnt allow block-camping. Also no way the two oponnents will be jumping around like in disco club. Also I dont like when you can kill your oponnent easily, even when its in fact his fault. The key of winning in "my game" is not having a "lucky" hit which oponnent happened to not block; but you have to outsmart him on the higher plane, by strategy, tactic, use of environment, w/e.
About Die by the Sword, I believe I played it once and I think i remember that I was trying to figure what each numpad key does for 2 hours then uninstalled it..could get it again though and give it a try.
About Severance, well no real experience, played the demo, and I remember only that i got frustrated when everything I had just broke 
Can any one of you think of any game-producing company which could get a similiar game-need as I do, and decide to work on it, in a scope of next few years ?