Not sure if I'm supposed to report 1.8 bugs here or not, so sorry if it's in the wrong place. Also not sure if this is related to 1.8 or if it's intentionally done this way. However...
For people with fly, before 1.8 the status (on or off) on login defaulted to the status of last logout. Now, with 1.8, it defaults to off on login. The problem occurs when people logout whilst flying. It's only a minor inconvenience, and eventually I'll remember to just not logout with fly on, but everytime I log in with fly on the last time I log out, I die.
It happened to me earlier today. The day before I had been observing the construction of the second floor of our temple when I logged out for the night. I logged in to a fall that resulted in an ooc death. In this particular scenario, I did drop my things and lose my levels. I had 28 levels, and I was reduced to 7. I was able to recover all of my items except an enchanted fishing rod, which I never found.
I'm not even sure of the dropping of items is connected to the fly "bug", but the solution to both (if indeed both are bugs) is to set the fly default to the status at last logout.