Mangetout makes the critical point here – since actual humans die when their VR personas are killed in the Matrix, killing someone in the Matrix really is murder just as it would be were the world real. It’s not a good defense because it doesn’t explain why the defendant is so out of his head that he cannot appreciate the consequences of his actions or cannot tell the difference between right and wrong, which is typically what is required for an insanity defense.
–Cliffy