No, he's not dead, yet, and hopefully not for a long time. Just tossing out some screenshots and will update this with more as time goes on.
My first few days on the island have been quite chaotic. Augustus is unique, not only because he's a Knight of Tempus but because he doesn't only pray to Tempus, but also to Tempus' two warhorses, Veiros and Deiros.
So here's what happens when he doesn't pray to Veiros enough...
(http://i746.photobucket.com/albums/xx102/Jacob8230/Augustus%20Krauss/Krauss1.jpg)
Sometimes I do have moments of awesome. I had a very fun orcs run earlier. =)
(http://i746.photobucket.com/albums/xx102/Jacob8230/Augustus%20Krauss/KraussOrcs.jpg)