Older way of things?
The titan losing levels on death was never a thing.
Unless my memory has completely soured of Beta 1 of Rebellion. Titans have always kept levels on death throughout its entirety according to my memory.
I'm pretty sure Titans always retained there level but I haven't been around long enough to definitively tell you. Goa should be around later today and he will give a full history of Titan leveling and whether or not they ever lost levels.
So I'm the official historian of Sins now am I? I'm okay with that.
I would have to look into the old beta 1 threads to make sure, but I also believe titans have always kept their levels. And there was no shortage of debate about this back then either, I can promise you...
Are they became immortals, goddess or what(Sins of Titans?)? Where is the logic here?
The logic here from a game design standpoint is that Sins titans were designed to be more like Hero Units in other games than Capitalships, and if you've played games like Battle for Middle Earth it seems pretty standard that Hero Units keep their levels when defeated and resummoned. Since the war in Sins is on such a large scale and Sins has a rather minimal story anyways, it didn't make sense to make characters for the titans, but in pretty much every other way that is what titans are. They are the most powerful single units available, are limited to having one of them, and they retain their experience when killed.
From the game balance logic as others have said, if titans did not lose their levels once you get to the midgame and everyone's titans has leveled up a few times, it would basically a game of making sure your titan is not destroyed. Even if you have a larger economy and fleet, if your level 6 titan dies while your opponent's lives and gets to level 7 you're larger fleet and economy might not mean much. True, in a 1v1 match any battle where you lose your titan might be fatal regardless, but much of Sins competitive multiplayer revolves on team battles, and your allies can often by you the time or send you the resources to rebuild a fallen titan.
Lore logic yes it is a bit harder to believe. That said, the Advent have a capitalship ability that allows there caps to regain their levels, so it really isn't a surprise that their titan crews can literally be saved through the unity and be deployed on a rebuilt titan. For the other two races, well it is standard practice for ships to take veteran crew and send them to train others so that if the ship guys not all of the skill will be lost. If the Captain manages to escape in an escape pod then you could argue its plausible that they'd have enough former ship crew and new members they trained to recrew a rebuilt titan.
Even if not completely level down, they have to go at least 3 levels down.
This was talked in the beta and I was fine with it, but it has yet to be implemented. Instead titans became more expensive and take longer to construct as they level up.
Also as with Superweapons, there are mods available for Singe Players who do not like this system. I made a mod that resets titan levels when they are destroyed for Rebellion 1.1, however surprisingly few people seemed interested, so I didn't update it by itself. However I still maintain it for Rebellion 1.52 as an optional minimod in my Enhanced 4X Mod.