Would you be less likely to interpret it as such if the speaker had omitted "literally"?
I would say that the sentence is an example of hyperbole. "I am so figuratively dead right now it's as if I am literally dead." The meaning of literally, there, remains intact.
In the same way, when someone complains that you left them waiting for "days" we don't say "sometimes days means ten minutes" but that sometimes people exaggerate.
If I say "I literally broke my arm" after I actually broke my arm, that use is completely correct. But you cannot be literally dead and still type a message, unless it's an automated message that you ordered someone/something to send AFTER you died.
If I'm on my regular nightly haunting mission, and I decide to speak to the new owner of the house that I'm haunting, how do I convey to them that I am really, actually, truly dead? I could say, "I'm literally dead", but they would think I'm laughing at their joke they just made!
If the answer to this is to avoid the word "literally", and instead replace it with "really, actually, truly" (like I did above), then I might just decide to retire from haunting.
Would you be less likely to interpret it as such if the speaker had omitted "literally"?
I would say that the sentence is an example of hyperbole. "I am so figuratively dead right now it's as if I am literally dead." The meaning of literally, there, remains intact.
In the same way, when someone complains that you left them waiting for "days" we don't say "sometimes days means ten minutes" but that sometimes people exaggerate.