I feel like lives are only justified in two cases:
1: It is a game that boots you back to the very beginning if you lose all of them, or a game with extended levels that have multiple checkpoints that boots you to the start of the level if you lose all of them.
2: Something resets or is lessened upon losing all lives, such as currency, power ups, points, or anything else of significant value.
If the only penalty from losing lives is the time wasted traversing the hub world again, then there is no point in having them. Since I doubt the game is going to work with the first case I gave, than if the game falls under the second case, like how getting booted out of the level reset note scores in the original B&K (in the Xbox remake, lives were basically a pointless artifact because you kept notes forever anyway).
I wouldn't mind seeing lives having a purpose again in this day and age. Nowadays, it'd be suicide for a developer to completely reset a game when all lives are drained, but it seems like my second case still might have a case in todays market. The brutal effect of the lives should only be noticeable for those going for 100%, so casual players are turned away because the difficulty is making the game impossible to proceed in. We should throwing our remotes at the screen for an optional obscure collectable that turns our characters blue, not the five Pagies that you need to access the next area and you'd kill someone just to get one of them or randomly glitch to the end of the game at this point.