'Life Commutation' as it is called in the RAF was once available to all officers (for ORs it was only permissible in order to finance an 'approved project'...!!) But, in the late 1970s the Government decided to phase it out. It was ruled that only those serving on or before 31 Mar 78 could still use the life commutation facility, and only on that proportion of reckonable service earned up to 6 Apr 80.
To illustrate the difference, when I PVR'd I had the choice of either:
£21381.52 per annum (gross) with a tax-free lump sum of £64144.56
or, with life commutation:
£18566.89 per annum (gross) with a tax-free lump sum of £109544.54
However, with savings interest rates as low as they are I considered that, as I didn't actually need the whole £110K lump sum all in one go and since secure investment rates are so low, I'd take the larger pension instead.
As for keeling over after retirement - the moral is don't do nothing! Find something to do - even if it's only quite simple. Otherwise you'll just atrophy, the actuaries reckon.