After reviewing the DAN statistics on fatalities, it would appear that the five tops reason for diving deaths are (in descending order):
1. Insufficient Gas
2. Strong Current / Rough Seas
3. Poor Fitness, High BMI / Heart Disease
4. Entrapment
5. Equipment Malfunction / Problems
I'm sure DAN's data is based upon incident analysis. Personally, I look at that list and see a lot of things with a root cause of diver error. Could be in the form of bad planning, a mistake under water, lack of training, misplaced trust, or excessive confidence. While human error isn't a component in every fatality, it's there at some level in an awful lot of them.
With regard to narcosis as a primary cause, I certainly think it can be. If a diver gets down and is feeling too happy to check guages, then running out of gas or getting too deep could occur as a result. Certainly, diminished mental acuity has to increase the rate of human error. You wouldn't take a couple shots of whiskey before diving, so why would you plan to incur narcosis if it can be avoided? It's a risk, but much of diving is managing risk. Understand the risk, choose for yourself, and don't take or send someone else down without a full understanding on their part. Pretty much the same thing I'd say about any aspect of diving.
With regard to this incident, I think we'd need to get a picture for the plan vs. actual profile and maybe some commentary from the instructor to begin to understand what went wrong.