At the end of the game it shows psycho stuck in the VTOL but does he die? I'm really confused!

I suggest watching credits and not pressing the "skip" button.

I wondered the same, then my mate told me not to skip the credits

Or if like me you don't want to sit at the credits for over 10 mins (literally). Just go to the link.

SPOILER ALERT

http://www.youtube.com/watch?v=U10GN5MItDU