So, given that the DELETE verb in Http is idempotent, when I issue the following request, what should happen the second (or third, or fourth, etc...)?
DELETE /person/123
The first time, the resource is deleted and I return a 204 (successful, no content). Should I return a 204 on subsequent calls or a 404 (not found)?
As HTTP requests in a stateless system should be independent, the results of one request should not be dependent on a previous request. Consider what should happen if two users did a DELETE on the same resource simultaneously. It makes sense for the second request to get a 404. The same should be true if one user makes two requests.
I am guessing that having DELETE return two different responses does not feel idempotent to you. I find it useful to think of idempotent requests as leaving the system in the same state, not necessarily having the same response. So regardless of whether you DELETE an existing resource, or attempt to DELETE a resource that does not exist, the server resource state is the same.
The RESTful web services cookbook is a great resource for this. By chance, its google preview show the page about DELETE (page 11):
First DELETE: 200 or 204.
Subsequent DELETEs: 200 or 204.
Rationale: DELETE should be idempotent. If you return 404 on a second DELETE, your response is changing from a success code to an error code. The client program may take incorrect actions based on the assumption the DELETE failed.
Example: