It is, accordingly, necessary to know and to teach that when holy men, still having and feeling original sin, also daily repenting of and striving with it, happen to fall into manifest sins, as David into adultery, murder, and blasphemy, that then faith and the Holy Ghost has departed from them [they cast out faith and the Holy Ghost]. For the Holy Ghost does not permit sin to have dominion, to gain the upper hand so as to be accomplished, but represses and restrains it so that it must not do what it wishes. But if it does what it wishes, the Holy Ghost and faith are [certainly] not present. For St. John says, 1 John 3:9: Whosoever is born of God doth not commit sin, ... and he cannot sin. And yet it is also the truth when the same St. John says, 1:8: If we say that we have no sin, we deceive ourselves and the truth is not in us. (SA III.3.43)
So there is a difference between "having and feeling original sin" and, on the other hand, "falling into manifest sins" such as "adultery, murder, blasphemy," etc. So it turns out you can out-sin God, as the Apology confesses: "But when we say of such faith, that it is not mere idle thinking, but that it delivers us from death and begets new life in our hearts, and is a work of the Holy Spirit, it does not co-exist with mortal sin, but produces good fruits only so long as it is really present" (Ap. II.45, emphasis added).
Now, in one sense it is surely true that you can't out-sin God: Jesus died for every sin. But in the sense in which Luther and the Apology are speaking you can out-sin God: you can drive faith and the Holy Spirit away with mortal sin, which is clearly a Confessional category. (This is the problem with theology by catch phrase: most catches phrases are both true and false depending on context and definition of terms.) Of course, you can be brought to repentance and come to faith again, as happened with David (thanks be to God). But it can also happen that you "make a shipwreck of your faith" and are not reconverted like Hymenaeus and Alexander in I Tim 1:19-20.
None of us will ever be rid of the Old Adam until we set aside this flesh. We will all always need to struggle against the flesh in the Romans 7 way: repenting in agony when we end up "doing what we don't want to do." Struggle, stumbling, repenting, trusting and all that continually: that is the Christian life. That is not mortal sin.
But ceasing the struggle, giving in, willfully choosing open sin as something you do want to do....well, that's a different thing altogether: mortal sin.
Failing to distinguish between the common struggle against original sin and falling into open, manifest sin is a failure of the first order in Lutheran theology. It first cropped up in what became known as the Antinomian Controversy. The quotation from Luther above is a summary of his definitive response to this controversy in the Antinomian Theses. You can (and should) read a full treatment of the topic in Walther's Law & Gospel, Thesis X: "In the sixth place, the Word of God is not rightly divided when the preacher describes faith in a manner as if the mere inert acceptance of truths, even while a person is living in mortal sins, renders that person righteous in the sight of God and saves him; or as if faith makes a person righteous and saves him for the reason that it produces in him love and reformation of his mode of living" [emphasis added].
What is a mortal sin in Lutheran theology? Not the same thing as in Roman theology, of course. In Lutheran theology it is not the objective magnitude of the sin (adultery vs stealing a pack of gum), but rather the willful choosing of the sin against better knowledge. Every sin is in fact mortal objectively: that is, every sin is objectively deserving of death. But not every sin is mortal subjectively, or in effect. Other sins are mortal in effect because they drive faith and the Holy Spirit away. Thus Luther's example of David's prolonged, willful, deliberate sin in the Bathsheba and Uriah episode. A prolonged, willful, deliberate sin of stealing a pack of gum would also be a mortal sin in effect because it too "drives away the Holy Ghost." So it's not the objective magnitude of the sin, but the active, willful, choosing of the sin against better knowledge that is the antithesis of repentant faith and thus mortal sin.
To learn more about mortal sin, the possibility of the loss of salvation, and how this should inform our preaching you can do no better than reading that Thesis X by Walther. To delve more deeply, see the sources collected by Schmid in his Doctrinal Theology (Section 41 I bracketed numbers 15 and 16. Page 421ff if you have the print edition). Schmid collects all the classic Lutheran theological sources from the Book of Concord down through Chemnitz, Gerhard, Hollaz, etc., and arranges them all by topic. So it's very handy on any topic you want to explore and sends you ad fontes.