The dead player's ghost isn't wearing the outfit from cash shop. Not sure if it's a bug.

Thanks for the detailed report! The Azalea and Clover come from a spring flower quest that needs you to carry them, and they were dropping at every level by mistake. They now drop only for players in that quest's level range, which is why your friend wasn't seeing them. Auto-HP now falls back to Elixirs and Power Elixirs once your other potions run out. A fallen character no longer gets party EXP or can use skills like Haste, even after a party Heal. We're also making sure a ghost earns nothing from any source and can't use any skill at all, and that it keeps your head, hair and hat while the rest turns into the ghost. Both come in an upcoming update.

Follow-up from the update: your ghost now keeps your head, hair, face and hat (Cash Shop ones too) while everything below the neck becomes the ghost, and a fallen character can't earn EXP from anything or use any skill, Flash Jump and summons included, until revived.

The Azalea and Clover should not be dropping unless that quest is active, I don't have it active, or see it in my in progress, available, or even upcoming

Azaleas, Forsythias and Clovers no longer turn up out of nowhere. They only fall while you're on one of the Spring Flower Research errands, and you can now take the errand from Betty, Lisa or Kong Ji without bringing any flowers first. Once you're carrying the 3 they asked for, they stop dropping.