Donkey Kong 64

In a game where Death Is a Slap on the Wrist, dying gets you expelled to the area's lobby on DK Island/to a cave entrance on the island. However, pausing the game and selecting "Quit Game" from the menu will eventually take you to the title screen, but first, you are shown a cutscene where King K. Rool presses a button on his throne, and a fully operational Blast-O-Matic begins charging up, pointed directly at the island, accompanied by impending doom music and letters superimposed over the outside shot, spelling "GAME OVER". The exact same thing happens when you run out of time in Hideout Helm.

Example of:
It's a Wonderful Failure