Undead=Evil

[Kelb_Panthera]

Isn't that they way of every nation that is, was or will ever be?

Yep, and that's exactly the problem. There will be inequality, there will be prejudice, and eventually the society will collapse either from outside pressure or internal decay.

Note the mindless part. Their is still plenty of employment for quick hands and a clever mind. If you allow the use of artifacts that can command the dead then one possibility is as NCO's and work gang bosses (overseers)

Those are necessarily small job markets though, unless each artifact is only tied to a handful of "workers." If that's the case then the cost will rapidly become a problem, and "workers" being stolen will be that much more likely. And what happens when one of these devices breaks? Accidents happen and in this case accidents result in a group, possibly a large group, of dangerous creatures being set free to run amuck, until they can be contained and either destroyed or recaptured. At least with machinery accidents don't result in the machine actively seeking to kill people.

Well they will pay rent and such, however I rather suspect that this will be considerably less that the going rate of their feudal cousins.

Maybe, maybe not. You've possited undead as the ruling body. Undead tend to have a problem with becoming increasingly dissassociative with what it's like to be alive. Combine this with the tendency of politicians to get greedy and lose track of what they're supposed to be in office for and you end up with people taxed and oppressed, eventually to the point of revolt if corrective action isn't taken quickly and often enough.

Except not having to worry about the constant threat of wars of succession (being as the ruling body is a theocracy of the dead). Plus it means that they at least know who their enemies are.

I'm not trying to be antagonistic, but this is laughably untrue, unless you hand-waive it for the campaign. The fact that the ruling body is composed of people that can't just be waited out means that political maneuvering and backstabbing will be that much more rife than they would be amongst the living. Worse, virtually all of the upper echelons of society have a myriad of supernatural and/or spell-like abilities to complicate security and counter security further. This causes headaches for the law-enforcement too. If the appointments of officials are supposed to be permanent, you even get wonderful little power vaccums if someone dies unexpectedly without naming a successor, something that they're less likely to do because the official A) doesn't plan on dying ever, and B) understands that naming a successor gives that successor a very solid motivation for his removal. (this statement should be read more as politicians are evil than undead are evil, FYI.)

Pretty much as standard for the period then. Of course unlike most they will have the ability to earn citizenship or even be accepted into the "nocturnal nobility".

So we're in agreement then, that the use of undead doesn't make the society any better or worse than most any other model? After all, the possibility of gaining higher station in other societies doesn't usually involve any change in the prospective's basic nature. How much upward mobility an individual has is dependent on the society's laws and rulers. Having the undead rulers writing those laws doesn't change that one iota.

Trapping it is acceptable (wouldn't want daemons getting hold of it and heaven forbid the gods). Ghosts would be fine to given the nature of the society.

Being a ghost isn't what I'd call "fine." No tactile, gustatory, or olfactory sensations ever again? No thank you. Becoming one of most breeds of undead also involves a complete change to the self. Vampires, ghosts, and liches are the exceptions, not the rule.