Ran a session this morning with 2 players. Both were 1st level. Jumped them with a few Vendhali Pirates roaming the docks of a Turanian town. They play smart (my group is good - always smart but always in character). They seperate the group & take them down one or two at a time. They get cornererd in a maze with one pirate on one end & two on the other & finally get hacked down in the same round. I just killed the whole party (admittedly just two though). But wait! They have Fate Points! They each spend one. They come through in the pirates' hold. It's completely dark. They're weaponless. They're injured, bleeding, & sore all over. They've been thrown in the bottom of the ship & it's filled with rotting caracases & they're down nearly full HP - left for dead under a sealed trap-door & no tools except rotting bones. What do they do? They take over the ship & even trap the Demon behind the pirate-cult (modified Rakshasha from the SRD - in D&D it's a CR 10 creature meaning the average party strength should be around 40 levels & should still cost the party an average of a third to a fourth of their potential resources).
In short, Fate Points are just an excuse to extend the story. One day, one or all of them will run out. New character. But that's part of the story too.