Pamela was already a ghost since she was first introduced in Gramnad series (Atelier Judie & Atelier Violet), and as usual, nobody (even herself) knew how she became a ghost. (Wikia)
There are 2 games where Pamela's cause of death were explained:
- In Atelier Iris: Eternal Mana, and
- In Atelier Iris 3: Grand Phantasm (as mentioned in the comment by Septian)
In Atelier Iris: Eternal Mana, it's explained in the main quest (SPOILER ALERT!) that
she was sent to a cave as a sacrifice to the dragon, but when she was trying to escape, she froze to death... (YouTube link)
and in Atelier Iris 3: Grand Phantasm, there's a side quest about Pamela's death, which
according to her diary which was placed on her grave, when she was going to cook, she tried to reach for a plate in the cabinet, but it fell. She dodged it by stepping back, but her foot landed in a pot on the floor. She flipped over, hit her head, and died. This entry was written by her mom. (YouTube link)
... which contradicts each other! However, considering that both of her cause of death was told by herself, the player can only believe even if it's true or not.
This also spawned a fan theory that not all Pamela is the same Pamela, similar to Cid in every Final Fantasy series (from Neoseeker forum, SPOILER ALERT!)