The merchant of death looks like a fierce name, and you would expect that the bearer is a notorious person. Possibly a killer and one who has deal with death itself. But the Common folks describes the merchant of death has someone who trades in the instrument of death. Most especially those who profit from the sales of heavy firepower and arms.
My first take on the merchant of death is like an emissary of death, but considering the word merchant, it has to do with trading. I guess that is why the popular meaning points to the sales of the weapon of death.