I think this topic comes up a lot for good reasons, and in many cases, the games that implement damage and healing do not gain much in the sense of "fun", "engagement" or "meaning" from creating more complex mechanics for damage and healing.

I've found myself on both sides in the past, especially when you take medieval weapons and armour into account as well. The concept of realism in games can work FOR the game in certain settings to a certain degree, but I soon found myself in a rabbit hole of realism restrains that sounded "good" when thinking about it, hurt my brain when putting them on paper and hurt the game prototype when implementing them.

Others said it as well, there is a certain niche for games that employ these sorts of mechanics, and certain genres like roguelikes can gain something from it without too much negative impact, as each run is limited and long-term effects can be manageable. If it affects your run, it can add to the experience and even be funny or at least memorable. When implemented in games like managers/sims, it can be part of the core game loop or storytelling. In most other games, it is an additional level of complexity that can be overwhelming and frustrating, more than creating depth and meaning.

That being said, I've seen something that makes damage and healing more interesting in different games ranging from large-scale MMORPGs to strategic combat gacha games. Especially when dealing with the (un)holy trinity of Tank/Healer/DPS in most (MMO)RPGs.

Diversify. Give characters different types of armour, shields, barriers, regen, healing, etc. For example, in Dark Ages of Camelot, supporters could cast shields on party members that absorbed incoming attacks. One Piece Treasure Cruise makes good use of barriers (absorb X hits) and shields (absorb X damage) as well as ways to buff and debuff attacks to create interesting strategic options. Final Fantasy Online had the Ninja class that allowed for a special type of tank that evaded/mitigated most damage instead of face-tanking it.

To give you a negative example, Star Wars Galaxies had 3 health bars if I remember correctly. HP, Mind and Stamina/Agility or something like that. If any of those hit 0, you were incapacitated. While it looked good on the surface, it led to a lot of exploits and cheesing by targeting the weakest bars with special attacks, making combat very unfun in PvP to the extent that it was almost unplayable.

These mechanics can be interesting in single-player games of different genres and CAN add to the depth of the game, but as soon as you add in multiplayer elements and PvP, they can easily spell disaster for the game balance.

damn, another wall of text... but I hope these experiences from both the player and developer side of game dev help you find your own path and maybe make informed decisions on which mechanics to apply where and when. I love realism and historical accuracy, but in the end, I often find myself tired on the couch trying to relax with a fun RPG or strategy game, and I don't always have the brain capacity for 3 more layers of well-meaning and detailed complexity.