Not acceptable #3: It's likely to come off as cheesy or unconvincing
Given that pro wrestlers occupy that twilight area between being a fictional character and a real person, it's almost unavoidable that killing them off as part of a storyline will come off as cheesy or unconvincing.
Perhaps the best example occurred in 2007 when Vince McMahon 'died' after his limousine exploded at the end of a broadcast. The reactions from most fans was first silence, then laughter.
Indeed, when the WWE attempted to have a program dedicated to memorializing McMahon and having a funeral service, the fans sang Steam's classic hit "Na na na Goodbye" in response, which frustrated the announcers whose job it was to sell the storyline as a legit event.
Because wrestlers are also real people, killing them off isn't going to achieve the desired tragic element; it's only going to make people incredulous.