Well, Kirk is dealing with an insane person's insane mind within an insane computer. So he's probably just speaking the guy's lingo, rather than sticking to objective truth. (Or then GO7 was the only death penalty in Starfleet books, while the punishment for murder is countermurder in the civilian books.)
As for the rationale for GO7, I don't believe for a second that Starfleet would fear human stagnation as the result of them gaining mind powers. There's a far, far more obvious and tangible reason for the quarantine, one that in fact formed about half the plot of the episode "The Cage".
Namely, if anybody goes to Talos in a starship, that starship then becomes a Talosian starship. These guys are hostile, and they can control your mind. You sure as hell don't let yourself, or any of your friends or allies, go anywhere near them.
At Pike's return, if Starfleet could, they would no doubt have bombarded Talos VI till it glowed, then kept on bombarding until it no longer glowed. But they couldn't do that, because any bombardment fleet that goes to Talos becomes a Talosian bombardment fleet. So the second best thing they could do was quarantine the planet.
But they couldn't just slap a simple "quarantined" sign there, because that would merely lure in adventurers. And they bloody well couldn't put up a "quarantined due to presence of powers that allow control of universe" sign, because that would attract half the galaxy there in quest for those powers. So they had to hang one of those
"intruders will be shot, and that means you" signs instead, the sort that doesn't give or require any explanation.
Of course, once Pike returned there with Kirk, the sign became irrelevant. For one thing, it had been proven that the quarantine didn't stop the Talosians from luring people in. For another, this was the second time they were given the chance to conquer the universe, and they still failed to do it. So no doubt the death penalty was dropped as ineffective and irrelevant as soon as Kirk returned.
Timo Saloniemi