I'm just wondering whether there are any good party-based RPGs that meat this criterion. It's common, in RPGs (CRPGs specifically), for one of the following two situations to happen:
* You create your party at the start of the game, and typically you hold on to that party all the way to the end. Or, you're given some choices between premade characters, and the typical strategy is to use the same team throughout, or if it isn't, characters who you don't use for a while are still usable.
* You don't create characters, but rather they come and go as the game progresses. (I'm thinking something like Final Fantasy 4 here.)

What I'm looking for is a third approach: You create characters (or recruit from a pool that isn't finite), but due to the way the game is designed, the characters you create or recruit at the start are not those you use later on, either because they're not viable, or because they're outright unusable.

I do, however, have a few preferences that exclude some obvious examples:
* I would prefer for there not to be any hard limit on this mechanic. (In Romancing SaGa 2, if you reach a certain point, or if the main character dies around 100+ times (or as little as 80), you are stuck with the final emperor/empress, and that character's LP death is a hard game over. (I'm actually considering attempting to play the original Japanese version of RS2, but it still does have this issue.)
* I do not want roguelike-style permadeath. For this sort of game, it's OK if a character can die permanently, but it's not OK if the game auto-saves when this happens. I want to be in control of saving and loading. (I believe this would exclude Darkest Dungeon.)

So, are there any games that would be suitable here?

Not 100% sure what fits your criteria, but a lot of CRPGs like Baldur's Gate have certain attacks and such that can permanently kill your party members. I'm sure 99% of people reload a quicksave when this happens, but in theory if you're not cheesing the game you would live with that consequence and get another companion to replace them.

Games like Fallout: New Vegas and Outer Worlds allow companions to die permanently on their higher difficulty modes, which can happen quite easily as they're action games.

There's like 30 companions in the original Baldur's Gate, plus you can technically beat the game solo, so I think a "live with the consequences" no reloads playthrough could easily work if you know what you're doing.

Pillars of Eternity. You can even kill your self-made party members to remove them from the pool.

Except that that's not what I'm looking for.

I'm looking for a game where the pool of companions doesn't shrink when characters die; in fact, I would prefer it to actually expand. In particular, I don't want such permadeath to be a setback, but rather have it be an opportunity for growth (new character being potentially more powerful than the former one), or a means to progress in the game.

Also, I want the game to be designed so that casual playthroughs (not hardcore ironman-style, and not speedruns) replace old characters with new/young ones during the course of the game. Can you do that to the main character (if there is one)?

Is there any benefit to doing this?

Fire Emblem series, FF Tactics, Valkyria Chronicles series, XCOM, Battle Brothers, Darkest Dungeon for permadeath / disposable characters.

I'd also consider looking into some of Tactics clones too (e.g., Ash of Gods, Banner Saga 2 and 3, Fell Seal are permadeath games on GOG). Can probably look up other SRPGs here that also apply to your other points: Fae, Zodiarcs, Ikenfell, Regalia, Shadowrun series are also all on GOG.

Problem is that simply having some permadeath isn't enough (and isn't even required to fulfill my requirements); the game needs to be *designed* so that a casual player, one who will save frequently (as much as the game allows) and reload when things go bad, will be leaving characters behind and making new ones as the game progresses.

Some issues with some of them:
* Fire Emblem series: Characters are finite (if you exclude the summons in FE8 and things like that), and the main character's death is a game over. The more characters who die, the worse off you'll be.
* Final Fantasy Tactics: There's some potential benefit to letting characters die, but I don't know whether it's enough to be useful, and most players are likely to ignore this mechanic. Also, apparently Ramza can't die permanently. (This is probably the suggestion that comes the closest to fitting, however.)
* Fell Seal: Arbiter's Mark: Permadeath does not happen with default settings, and when it does happen, it's strictly a bad thing. Furthermore, permanently dead story characters will still be usable in story maps that require them (particularly noticeable when it comes to the main character).
* Ikenfell: No permadeath, and the playable cast is finite and relatively small (6 characters), so doesn't even come close.

Again, permadeath isn't the main focus of what I'm looking for; getting new and better characters as the game progresses (instead of focusing on upgrading your existing characters) is what I want.

Dragon's Dogma: Dark Arisen and it's pawn system comes to mind.
Even if it's not an CRPG, I assume you could use it as a case of study.

Playing in Hard difficulty, some encounters with low leveled paws can go really bad.
There are no permadeaths, but hired pawns don't level up, so you need to upgrade your party with new pawns, new strategies, new skill and classes setups once in a while, to probably never use early-game hired pawns again.

Since theres an in-game 'currency' to use with the pawn system, you can't hire higher level pawns without paying. (Values are really high.)
So you're forced to switch your party constantly. Changing your class and main pawn class for experimentation is also encouraged.

-edit: Better writing.

I've never played a game in which you can continue if the main character (="you") dies...

A benefit? I think that there's limit to the pool. Other than that... maybe a bit of an "OCD" one: you make a character and you're not happy about it - and it bothers you that it's still available in your pool.

This makes me think of an older Capcom game, Destiny of an Emperor. While there's a small number of characters who gain the game's HP equivalent when you level up (everyone shares a single level), most of the recruits do not. It still does have those characters who gain the HP equivalent who you're likely to use the entire game.

Considering a few other games:
* Shin Megami Tensei series has monsters who either don't grow or see only limited growth. However, there is a fixed protagonist, so this doesn't quite qualify.
* Dragon Quest 5 has you using recruited monsters for a good portion of the game, but there's still the fixed main character, and many monsters are kept for large portions of the game.
* Dragon Quest Monsters, it occurs to me, would qualify. The main character isn't a character for gameplay purposes (he doesn't participate in battle), and you're constantly breeding new monsters with better stat growth and level caps.
* Pokemon doesn't quite fit because it takes too long to level up new (non-legendray) Pokemon, plus the starter is generally viable for the entire game (except when there's a type disadvantage), so you'll likely be holding on to it.

Romancing SaGa 2 does this, at least until the Final Emperor/Empress. When the main character (the current emperor) dies, you get to choose another character to take over as emperor. (There's also generation shifts when you are forced to choose a new emperor, and the current emperor may abdicate if an event ends badly, like failing to save a town from a volcano.)

Counter example: FE10. Once you get to the late game, your character roster grows to include stronger characters. You can play poorly and still be able to beat the game with them, having a total endgame roster of 76. And some other FEs have Est, Gotoh, and Beowulf archetypes where these endgame characters can hold their own or can be trained to become very strong than original characters, similar to Pokemon's pseudo-legendary archetypes like Dratini.

Going to be a challenge finding games that reward players for playing poorly enough to progress the story, especially one that lets you continue without the main characters since the story will suffer for it.

SaGa 1, one of the early Dragon Quest games; (probably III) have recruitment instead of proper parties. They die, it's time for you to run back to the guild and roll someone new or find the way to restore them.

Well that is indeed the first game that came to my mind. You could of course just say DD plus some tool that backs up your save every few minutes (some tool like that was mentioned in another thread recently). :-)

Of course DD doesn't really work without the autosave, on the other hand it really shows the downsides of this system too. A simple oversight (I forgot to buy torches or food *ouch*), a mis-click (happens to me rather often, with varying direness of consequences), a really weird RNG (all enemies crit on the first round - had that happen several times) can easily ruin your day. So I'm really torn about the game itself.

SaGa 1: You can't replace the main character this way.

Dragon Quest 3: There's no advantage to replacing characters this way, unless you just want to train someone new from scratch (and still have the option to re-recruit your former character). Also, the main character is fixed (though you can choose gender and name), can't be removed from the party until post-game, and their unique class can't be given to a new character.

Dragon Quest 9: See Dragon Quest 3, except that the main character has a unique skill rather than a unique class. (Main character's starting class is fixed, but you can change it later.)