That's what I also assumed as well. While it is really a matter of opinion whether they are truly alive or not, as presented in the films droids like C3-P0 are just as fully realised sentient beings as everyone else, as opposed to the Battle Droids which are clearly just walking gun carriers with basic programming.
Plot-wise, the other reason for the uhuge mortality rate is a. most the main TPM charatcers are Jedi, and the fundmanetal plot of the story revolves around the extinction, and nearly all the rest are bad guys, who die by default.