It seems odd to me when she loses she is considered “Dead”. I know from a game standpoint it just means she’s unavailable to use until you use an item, but still. Maybe another status for her might be more appropriate…something like void, N/A, Lost…I dunno.
Also, when it comes to matches with characters like Jago or Orchid it seems odd for them to kill their opponents in a sparring round. Perhaps maybe a different status, such as Knocked Out would be more fitting than Dead. Maybe if it happens instead of taking them out completely (Dead) it could instead just cause your character to be not available for a day, but you can still use a Phoenix Relic/Scroll of Ressurection to revive them as if they were dead if you don’t want them to wait a turn.
Or have them be at 1% health like it is when you deployed someone and lost. But I agree on your general point. It’s also weird that missions like that influence corruption in any way. It would certainly be a step towards more distinguishable mission types.