Cool, I'll bite. I see what your saying about game design and incentives, but I think your confusing incentives with punishments when you could split them into two: rewards and punishments.
Punishments are for players who don't do the thing, motivating them to find ways to avoid threats as you said. The problem is if they don't see the rewards in doing it, they're just as likely to quit. Dark Souls has a lot more quitters than its fans would like to admit.
Rewards are what players get when they do the thing, usually appropriate to the thing done. Not all people are motivated by the same rewards, tho. I get how games can serve under-served niches, but some people don't appreciate how great games can somehow give different rewards to different people.
It is perfectly acceptable to have quitters if you actually create something that properly appeals to an audience.
Right now the main quest is certainly appealing and the rest of the mechanics are a mish mash of unconnected things with no reward or punishment.
Honestly, I'm more into Simulations than Sandboxs, where the goals are entirely made by the player, but I admit it requires understanding the game to enjoy properly. As much it's hard to do right, I'd be more impressed if the game turned more to the former than the latter.
Those are interchangeable words. They mean the same thing. What you're saying is that you like sandboxes with no actual challenges at all, just a general experience that you win as long as you don't do anything dumb dumb because literally nothing threatens you. We typically call these themeparks, where all the rides in the themeparks are just sitting there waiting for the player to come along and experience them if they want to. This is the way of Fallout and Skyrim. These however have CONTENT that drives the player, an utterly endless amount of quests to explore and perform.
The problem with themeparks is that once you've experienced the quests all you're really doing every time you play is redoing quests you've done time and time again.
Sandboxes in comparison to themeparks are versatile things, the player experience will be different every time because there is plenty that is entirely out of the player's control and the player must make decisions that he may not want to make but is forced to make them because of their difficult situation (economic or otherwise). A player may not want to whore their pure character out performing blowjobs in alleyways just to pay rent, they may not have intended to, but the harsh conditions of reality have created a scenario that forces the player to do it. This is a sandbox experience, you do what you have to do to survive in whatever conditions are given to you. These conditions will differ hugely from play to play to play and the re-play value goes through the roof. In the non sexgame world this is the Mount and Blade approach to gameplay. And this is how Degrees of Lewdity does it.
Lilith has quests, but it also has the groundwork for an excellent sandbox. The point I am making is that Lilith should be both. The story content will become something players that have experienced it chew through in a single play every single time an update is released and then they are left waiting for the next update, they don't play it in between because they don't want to, there's no game to play as far as they're concerned, they've done everything it has to offer.
Make the world both a sandbox and a story quest experience or nobody has any reason to play if they've done the story quest.