Ah, that's a shame to hear. The fact that devs feel pressured to cater to the lowest common denominator is one of the biggest downsides of the alpha/beta release crowdfunding model imo. As I said in a previous post, contrary to the intuition of a lot of players, the game's hentai content would actually be experienced more and in a more satisfactory way if the difficulty is raised, not lowered and given to them for free as a gallery. But trying to convince the mob of something like that is impossible, so they'll keep demanding "make it easier, easier, it's too hard". I'll hope that Scarlet Paper puts in a hardcore difficulty mode when the game is finished that restores some of the original difficulty (with better balancing around the sex hp loss), but that's probably highly unlikely to happen.
I'm of two minds here. In principle, I agree that it
can elevate the H-scenes when it's an organic consequence of gameplay. But it has to be balanced against fail-states and the frustration they can bring - as well as the player's overall power and agency. A "roguelike" with extremely linear and gated level/enemy progression I feel is quite bad for that.
The frustration of being reset and having to spend time and effort re-treading all that same ground tends to take a lot away from at least my own ability to enjoy H-scenes - especially if I've already seen it and was trying to get to the next one I hadn't, or to beat the game to unlock a gallery - and especially if I can only see two or three of them before I have to experience that fail-state and corresponding frustration. Equally, being entirely removed from context and viewed from a gallery can be diminishing as well.
I think the best way to handle loss/failure states in H-games is to largely avoid true "game-overs" or full resets, except when it's demanded by thematic context. Have the player-character wake up in some side-room that reconnects more or less back to where you were. That way it stays a part of an unbroken continuity, and enables players to have their cake and eat it too - enjoy "loss" scenes, without losing much progress.
A "roguelike" of Thornsin's kind is quite antithetical in design to that - but there are steps that can be taken to bring it closer. Less-linear level/campaign design, overarching progression, a "hub" world/menu with more shorter, self-contained levels etc - though it might all work better in games that are more strategic and "attritional", than action-oriented and decisive.
For example, "Apostle Angel Liebe" by Mad-Script is a much more traditional rogue-like. You have two player-characters who have massive pools of energy, from which HP regenerates. When HP is 0, the character is simply knocked down for a couple turns. Energy depletes with movement, special ability use (iirc), HP regeneration and climaxes. HP can also be restored with potions to preserve energy. When one character's energy and HP are entirely depleted, they are captured and the other retreats. Your objective is then to attack a new dungeon to rescue the captured character - but you might have to wait and skip some time on the campaign layer to regenerate the surviving character's energy enough to succeed, and that's where the meat of its H-content is.
There are quite a few in-game animations, un-detailed, short and simple as they are - another developer might balance those things differently, and AAL certainly has plenty of its own flaws in terms of progression, gating content etc - but the overall principle is there. I get to experience almost all the game's content without continuity ever having to be broken, without being frustrated by the individual failure-states required to see it, and the only way I fully lose and have to reset or load an earlier save, is as a culmination of many prior failures - or it's directly engineered by me. In other words, you can lose many proverbial battles but still win the war.
Another couple examples would be Kudarizaka Guardrail's games - Quarta Knight Emerald/Amethyst - where the battles are pretty much all about H-attacks and their consequences stacking up, and persisting between them. I don't even remember if either of them had true game-overs to speak of, and IIRC you could reverse basically all the debuffs. If you were defeated, you got a scene and then crawled out of the bushes or whatever, and either continued the level or retreated to base.
T&A is the main selling point of any game we talk about here. Anything else is secondary. The ideal H-game will accommodate both the player just looking to get their rocks off, and the player who wants to lock in for a challenge (with sex). Difficulty levels, cheats, galleries, level select etc are the most common ways around that and for good reason. Overall, it's about developers respecting the players' time and priorities.