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Does failing an encounter ever do anything special, or does it always just send you back?

All of them currently just send you back to try again.

Good. If failing ever does anything special, make sure to signpost it. Do any of them have special dialogue for failing, or just the scripted one with the rats?

There is always something written for each encounter, but it is brief and I would not describe it as “special” in the context of the game. Put another way, I would not recommend that someone specifically try to lose every encounter to see it all.

Great.