Face it, everybody dies.. yes, even horses...
Now what if Madara is the result of an "Edo Tensei" and this is why is is only a shell of his former self..
Maybe there is a story there, that Oro after his defeat by the 3rd, worked hard to perfect his Edo Tensei... not likely but possible.. IF..IF he is Obito the only way I can see that working, Is that Obito was still alive, crushed but still alive. I believe this is where Kakashi got his MS, so peerhaps as the eye changed to MS perhaps the other eye did as well and transported, gave Obito the ability to transpot rather.. Only way I can see it happening... Or Madara DID die after his epic battle, and someone took his eye(s) and being an EMS it could have transfered his soul to the recieving host. If the host wasnt an Uchi clan member, then his powers would have been limited as we see...
OR... Madara is nothing more than a physical shadow.. and needs the Jubbi's power to become complete again.. Cause if it really is Madara, he wouldnt get weaker as time went on.. even if he did use Izunagi like danzo, he'd only lose the ability of that one eye...