Game or movie? Make a choice.
If you want to make a game, make a game. This weird bastard of a hybrid you've introduced here is either a movie that you have to fail at a game in order to access or a game that requires a hard reset in order to continue after a mistake. Neither possibility is remotely appealing.
Don't get me wrong, both your game and your movie are very good, but each one is so detrimental to the other that the final product is not the least bit enjoyable.
My suggestion: introduce two play modes. In the one, the character is automatically shown entering the castle and dying to some random hazard. The movie sequence then shows and everyone can have a good laugh about it. In the other, the player controls the character through the castle and has a real continue option upon defeat. The player can then progress through the castle and enjoy a conclusion to the challenge they have just overcome.
As a postscript, jumping felt very awkward. He never seemed to move as far as I would have expected him to.