This is all very simple. The person who should die is the one, or both, who collide.
If you hit him, you take damage.
If He hits you, they take damage.
If you both hit, you both take damage.
Just like in the real world, if you don't collide, you don't take damage. The only difference is that this isn't the real world and for every player there is a different reality. Unlike the realworld, we are trying to shoot at people who's real location is hundreds or thousands of miles away, in which the internet tricks us into thinking they are yards away. Because of this...you might very well collide with someone...however, the other person saw no collision in their reality...in fact they were 100 yards, 50 yards, 20 yards, away...you pick.
The only variable is what the other guys computer see's. I don't see how making someone take damage, who didn't actually collide is fair. Turning off collisions would be as bad as making someone take damage if they didn't collide at all...though it might be amusing watching a pony dive on me, fly through my tail, through my cockpit, and emerge on the other side....would set up easy overshoot, provided he doesn't tear my pilot/plane apart from the inside out. I'm sure both would get old really quick.
I guess you have to try and figure out what is more realistic.
-A world where you can fly through solid objects without fear (remove all responsibility from everyone in collisons, but severly effecting gameplay and immersion)
-the winners of this reality...people who believe collisions don't happen and those who are able to believe solid objects can pass each other without incident.
-A world where you can take damage seemingly from nowhere and through no fault of your own. (taking away all your abilites to dodge a plane, and giving all trust to your enemy not to)
-the winners of this reality... people who want to ram
-A world where you take damage if you see a collision...even if the other person does not. This gives responsibility to you, if you risk a collision, you might collide. All the other scenario's remove your responsibility, and the second one actually makes it your enemy's responsibility (not yours) to not ram you.
-the winners of this realilty....the people who don't see a collision.