So episode 3 is side story material, nicely fit in to the continuity of the anime. This episode recounts events when Kirito first joined a guild and lied about his level being significantly higher to his fellow guildmates and the subsequent emotional scars that will follow. While most people are saddened by this episode, I’m surprisingly very indifferent about this.
Now explaining this episode in my opinion through an MMO perspective, the reason behind this is that the level gap between Kirito and his guildmates were too big, so enemies set on Kirito’s minimum level appeared and in effect Kirito was tanking the whole guild which made levelling and money quick for the guild because Kirito knew how to beat the monsters since he was a beater and knew the safe grinding areas. That last dungeon before his guildmates were slain in my opinion were set only to Kirito’s level and the mobs are too many, thus the guild was slain. This is the most logical explanation that I could come up with.
I find that the guildmaster committing suicide was stupid. From a purely writing perspective, many other things could have happened such as the revenge plot and other things but he just had to commit suicide which felt very cheap and convenient in my opinion.
Kuro's anime ramble blog 
The guildmaster just went to purchase their first home. Then he comes back and finds out that his four best friends all died. Try to put yourself in his shoes. I don’t think that his suicide was completely unbelievable, although one could argue that giving up life is always wrong.
If I was in the guildmaster’s shoes, I won’t throw away my life just because of that, rather I’d try to kill Kirito on spot or I’d grind so hard that I’d be strong like Kirito and then enact my revenge on him.
I was pissed off as well at how they concluded the death of the guild leader, well all the guild members too, too rushed we couldnt even get into the characters because they only had like 10 minutes screen time, Sachi’s death was kinda sad but come on you cant get attached to a character so quick thats why I wasnt really affected about her death. Shame I really wanted to learn more about the guild, should have been about 2 epsiodes.
The thing about this episode is that this is side story material and as it is, its actually amazing on the animators’ part to be able to include this in the series. While this episode was terribly rushed, I do commend the animators to be able to project the intended emotional punch across to most of the audience.