This was an incomplete question. See Why was my question redirected here (Fixed by Danielu Yoshikoto)
Because Touhou characters don't feel like killing each other.
To clarify a bit more, the Spell Card system the characters use is deliberately designed to be a non-lethal form of conflict resolution. It's a way for humans to challenge youkai on a more equal footing; for youkai to challenge the Hakurei Shrine Maiden without fear of killing her and causing the Great Boundry to collapse; and for powerful youkai to challenge each other without killing each other and wiping out half of Gensokyo in the process.
Or maybe you're under the impression that none of the characters ever die ever: that they're all immortal. The answer is: they're not. Kaguya and Mokou are immortal because they drank a magic elixir; and Yuyuko may be "immortal" because she's already dead. The rest, however, are not immortal, although the youkai among them may be extremely long-lived, because...well...youkai just live for a really long time.