I was just re-reading Bakker's posts on the old three-seas forum, and had something of a revelation. Perhaps this has already been discussed and I missed it--but as Bakker puts it:
[...] Given this overarching indeterminacy, there's three basic options: Oblivion, Damnation, or Redemption. [with regards to souls in Earwa]
When people are reborn, their souls most likely come from some pool in the outside--the real question is whence comes this pool? If it is a closed system of souls, the only pool to draw from to bring souls back into the world is that of damnation. Those who are redeemed or have achieved oblivion must necessarily have escaped the strictures of the system--leaving only the pool of the damned in play. That would be the ultimate in massive cruelty--everyone in Earwa is born damned, and if they do nothing to redeem themselves or avoid the notice of the gods, they just go right back into the pool for another round of damnation. Earwa itself is a place for the damned (hell) and the 100 are just the prison guards (those in charge of administering punishment) in this scenario.