I play a wizard and I actually had my spellbook taken once.
I got killed on a botched dungeon run. I have a book that I just "pretend" is my spellbook. (It is the generic holdable book item). I was revived by a character who was hostile to me, and he role-played that ALL of my possessions were taken. (even my boots!)
I do not want to divulge the details, but I sat around for about an hour being worthless in my underwear (in character) doing nothing until my companions could get enough money together for a bribe so that I could get my things back and then escape. Mechanically speaking there was nothing stopping me from resting and then throwing out empowered missile storms, but that would not be interesting as I had gotten killed and lost my inventory fair and square.
This was a pivotal moment in my character's story, as he is now greatly afraid of the desert.
I think it is a good idea for a wizard to have a unique item that serves as a spellbook, but if it dropped on death then it would just make the game so difficult to the point that it would not be fun. However, when it is part of the story I believe that the players will want to play fairly.
I just think that making the spellbook drop on death would be about as fun as a game about trying to find your car keys. Yes it's realistic, but real life is not fun. But yes, please add the holdable book item to the character creation store, I would like that.