MIB said to Jacob, "they come, they fight, they die. . . it always ends the same." Jacob said "it only ends once; everything before that is only progress." (paraphrased).
Here's what's happening on LOST: For years, Jacob has brought people to the island. All have died, because they fought each other. The Black Rock guys killed their captives (Richard escaped). The "Hostiles" fought with the Losties when they traveled back to the 1950's. The Hostiles fought with, and killed, all the Dharma people. The Losties crashed on the island and the Others fought with them. The tail-section people killed the front-section people and vice-versa. And what did they have to fight over? A beautiful island with great weather and all the coconuts you could eat.
Jacob is trying to show MIB that people are basically good. MIB thinks they're just going to keep killing each other. MIB has always been right -- until now. Our group of Losties is sticking together. They believe in "live together, die alone." They sacrifice their lives for the good of their friends, or the group, or their loved ones, including Charlie, Jin, Sayid, Juliet, and many others. Finally, Jacob is right. Something momentous will happen. But what? I dunno. Maybe everyone gets to live happily ever after in the sideways world, with their island memories and their loved ones alive again. Maybe the MIB disappears, or dies. But clearly this is the "ending" Jacob was talking about -- finally a group of people who put others first.
The bad news is, this may mean that more of our favorite people will die to protect the greater good. Maybe the "candidate" will be the only one left standing, and it will take everyone else's sacrifice to finally defeat the MIB. Instead of merely keeping him trapped on the island, maybe if everyone works together and sacrifices for the group, he will be gone for good.
None of this has anything to do with Jacob dying -- THAT happened because the MIB finally found a "loophole." But I think the little boy who keeps appearing on the island is Jacob growing up. I think Jacob will grow up just in time to see the Losties complete their mission. MIB will die, and Jacob will be released from his duty to watch/confine him. But if the Losties start to act in their own interest, and Jacob isn't around to help -- MIB may escape, and then we have disaster rather than eternal happiness.