Ooooooooooooooh my bad! I had fixed it for multiplayer only, forgot about the single player mode!! This is fixed now. I'm not 100% sure what you mean by no damage is dealt, but I suspect you're referring to the cocoons? Once captured other caterpillars can slowly turn them back to white and get a chance to steal them.
To be on the safe side, I've added some more visual return on hitting targets + screenshake, hopefully this will give players a lot more clarity on the game mechanics ;)