With swine flu in the news I decided to make some very rough estimates with available public data to see if what's being reported really reflects something unusual. My conclusion is that 200 deaths per month is around what you might expect for the Mexico City area in April.
According to the CDC, there are about 36,000 deaths in the US each year which are related to influenza. The population of the US is now about 307 million, while that of Mexico is a little over a third of that, at around 111 million (according to the CIA World Factbook). If the death rate in Mexico is similar to that in the US (it won't be, but I'd expect it won't be less, and it could be close) then we can estimate at least one-third the number of deaths in Mexico -- about 12,000 per year.
If these were spread out evenly throughout the year there would be about 1,000 deaths every month. They won't be, but we are just making rough estimates here. Besides, if the infection rates in Mexico fluctuate over the year with the same pattern as in the US, as shown shown by Google Flu Trends, then the infection rate in Mexico in April is probably close to the average over a year. (Google just added an "experimental" version of Flu Trends for Mexico, and from that graph I'd also call April "average" -- except for this April.) From these infection rates I'd expect the death rate in April to be close to the annual average. So as a rough approximation, we'd expect the number of flu related deaths in all of Mexico to be about 1,000 per month.
The population of the greater Mexico City area is 22 million, about 20% of the population of Mexico as a whole. If the infection and death rate are independent of location (they are not, but it's a good first approximation), then 20% of the 1,000 deaths would be in the greater Mexico City area. That's 200 expected deaths in April.
According to press reports, and the Google Flu outbreak map, as of April 30th there have been 7 confirmed deaths and 168 unconfirmed deaths in the greater Mexico City area due to swine flu. That sounds like a large number when it appears in the news, but compared to 200 expected deaths from some sort of influenza it sounds less remarkable.
Of course this is a very rough estimate, and the CDC and WHO will make the same calculations using better data and more refined assumptions about such things as how the infection spreads in high population areas and how many infections result in death. Their concern is also that the virus may spread easily from person to person, perhaps more easily than other forms of influenza.
Also keep in mind that the averages I've used are based on data that have been collected in the past, over a larger time interval, while the news reports are based on data collected quite recently. It's only a rough approximation to compare the two. There may be more deaths in April than have been reported now, but those reports will take some time to get into the public record. Whether the count goes from 175 to around 200 or well above 200 remains to be seen.
To summarize, based on rough comparison to the US death rate for influenza, I'd expect 1,000 deaths per month for all of Mexico due to any type of influenza, and 200 deaths per month for the Mexico City area due to any type of influenza. The number of deaths reported in the news match this, at least in order of magnitude, so those numbers should not be considered unusually high.
There may be other reasons to worry about this new strain of the virus (like the fact that it's new, that it's type H1N1, and that it seems to spread rather easily), but just the number of reported deaths should actually not be cause for greater alarm.
Even so, it's still a good idea to wash your hands, and cover your coughs (and not with your hands!). But that's always true for any flu outbreak.