Somehow all my healing items were staying with me when I died, but they did go away when I completed my run. Also, the Dragon TF item I got through the TF gacha artifact transformed my arms... into Mermaid ones.
Defeated in battle, simple as that. As for the TF gacha, it was the artefact that gives 2 TFs and 2 TF items. Also found another potential bug, where the green crystal that boosts healing does not start tracking floors cleared until after you obtain it. This might be intentional, but previous versions had any floors cleared take effect immediately.