Revan was a shell of his former self. Broken after 300 years of battle with the Emperor's mind. He was driven mad, his morals twisted and his mind deluded.
He wasn't beaten by some random team of Imperials either. He was beaten by the best team the Empire could throw at them. And they weren't even at the height of their power. But he probably isn't dead... yet.
I'm pretty sure he's dead in terms of physical body death, just as I'm sure he's around as a force ghost now. The point where the battle ends is definitively before Revan runs out of health. The party don't kill him. They do, however, beat him to the verge of death. When it reaches that point, the realisation of how wrong the things he was about to do (ie the indiscriminate genocide of almost the entire imperial population) were hit him, and he perhaps saw the effect the Emperor had upon him as he had influenced the Emperor. Horrified, he chose to die, to become one with the Force, rather than allow the taint of the Emperor drive him to greater horrors. He tells this to the player by quoting Malak's dying words as an acknowledgement that he was too far gone to be saved.
At least, that's how I choose to interpret it until someone deciddes to try and make money by bringing Revan back from the dead.