So I've been looking for a game like UO forever too. I recently came really close, and some of you might like the game (for me it was too imbalanced). The game is called Salem (search for salem the game). It's setting is in pilgrim times, and it's a perma-death game. It's extremely harsh and has a lot of the same sort of feel UO had back in the day.
The only reason I'm not fully hooked is that the game is too imbalanced. Established players wipe out newbs before they can build up their characters, and with perma death it makes it pretty rough. The community is so-so, and the game population isn't super high. It has the same steep learning curve that UO had though, and the graphics while not up to WoW's standards, are better than trying to play UO now.
I never played UO, and barely know anything about it. But I do miss the more hardcore elements in gaming that used to be popular back in the day. I am so sick and tired of all the limitations and artificial "progress" that's plaguing pretty much every MMO today. The concept of "Soulbound" is ridiculous for example.
You cannot do that while stunned.
You cannot do that while stunned.
You cannot do that while stunned.
You die.
You are dead.
For those who keep mentioning ArcheAge, I played AA with the hopes that it would be a UO replacement and while it resembles UO the most of current-gen MMOs it is still far far away.
-No death penalty in PvP, you do not drop any gear nor is your corpse lootable. There are however a few items that can be dropped which are packs that must be carried to specific NPCs to trade in. This has led to camping of the the trade NPCs as people try to take your packs and turn them in for profit. While carrying a pack your move speed is reduced so it's difficult to fight back.
-While there is mounted combat, you're limited to certain mount based melee attacks as is everyone else. It is not really feasible to fight while mounted.
-Mounts can die but you will always have it in your inventory (it must be rezed), similar to hunter pets in WoW
-SAFE ZONES. The open sea concept was a good idea (pirates), however, there are too many safe zones all over the world. The 3rd continent has no safe zones and allows for territory control but its more like a pvp mini game with one side defending and another offensive.
-While housing is not instanced, you are restricted as to where you can build homes to certain "housing areas"
-Game is level based, ie you have to level to level cap via questing or other means similar to WoW. Once at level cap you pick the skills/talents you want from talent trees.
There are a bunch of other reasons, lets just say it's not like UO