Can NPCs really die?

According to the wiki here:

If any NPC were to die (eg. During a Blood Moon) they will simply return after a period of time, as long as no other NPCs moves in during their time of death.

In episode 21 of Red & Blue's preview of Terraria (at about 2:45), they suffer a zombie attack in which several of their NPCs die. In later episodes, however, the NPCs have returned.