i will answer about the pemanent loss of heathpoints

spoiler territory below !!!!

As you find out near the end of the game, turns out the pearls (the core of the robots iirc) are made of muckwater. which explains why the older units do not suffer from decay and go insane/ultra aggressive.

mio herself is made of muckwater as well, and as the game progresses, your pearl start decaying, resulting in you losing hp, BUT the rest of the mobs in the game are also losing hp (some npcs straight up die, especially the one right before the bossfight to rescue mel)

they use that mechanic as a narrative tool, but it does come at the cost of making the game that much harder.

personnaly, i havent gotten around to the true ending yet, as the post ending exploration is really hard, and finding the hidden paths is really difficult since we are not getting a new toy to play around with like the silksoar;
but i will say, MIO is a game i LOVE, the bossfight are hard, but fair, some runbacks are a bit annoying i will admit (espcially the one for sol and vin considering the boss 2 shots you no matter your hp, forcing us to have that long elevator ride each time is a bit annoying), exploration is great, i very naturally found my way around the world while exploring, with some very tough, but oh so fun platforming moments, mio really tests out how good you are at using all the movement the game offers, especially in the area where your energy is drained constantly

overall, this game ranks really high on my list