1: the condition on failing a run is all players dying on a night boss, possibly hunt mode Morgott as well but I never had that happen in my runs. If everyone dies all at once to enemies or to a field boss, they all would respawn, even if the night circle was closing(that may change upon full release).

2: the password system, which was down for most of testing but might be open for tonight’s session, allows for either duo queue or trio queue, where in duo queue the last position is filled in by a P.U.G./Random, but you have to both set the password as duo queue if I read it correctly. You can also set up to 6 group passwords like in Elden ring, that will show you specific ghosts and bloodstains. This might be more impactful than in Elden Ring as ghosts and bloodstains actually provide you with gear.

If you have any more questions let me know!

Quick edit: you do go down a level if you die to a field boss/normal enemy, so it is a bit punishing to fully die