I dont think that not marking people as dead is the whole story. A while ago many matches started to have <private> on the relatives which, if you go in and look at the match in Compare Tree, becomes visible. I just checked one of the matches I have got. They have both birth and death info. Either the people have changed the mark for their trees as <private> or a system glitch has done that for them. I saw a post here where someone had <private> in their tree without having done anything by their knowledge.
This is not the only reason as to why a person would be viewed as <Private>. Another reason is for a user who is publishing with the Family Tree Builder specifying for specific people (or facts) to not show on their family site.
When encountering such people you will not be able to view either all information or some of it.
If any of you know any private cases where it looks like the user on the other end did not do just that, we would be glad if you could write an email to email@example.com.
Currently, we do not know of any bugss that cause the smart matches show <private> people on your tree.