Really unique concept! I ended up playing it all the way through and reaching the ending without too many restarts -- I realized that if I stayed near the spikes the enemies would hurt themselves by walking into them. The restart mechanic really reminds me of the chilling moment in Undertale after I tried to restart my save file after killing Toriel and feeling bad (search up Flowey on Saving Toriel on YT). I think this has a lot of potential!
I think the melee hitboxes could use some tweaking, sometimes it feels like my hits should have connected when they didn't. Also I saw you mentioned on discord that players weren't realizing that restarting was a core part of the game progression. I think one potential idea is to make it so that the restarting doesn't require a player clicking a "restart" button, and also mixing up the dialogue/animation even more drastically so it doesn't feel the same. You want it to feel like a restart, but you also want to convey to the player that big changes are happening, and they should continue playing to find out more. Making the player have to click a button before knowing this is likely causing a lot of drop-off.
Overall a great entry to the gamejam and I hope you continue working on it!