If you optimize your stats 16 - 20 of endurance will be enough plus emerine armor and Nameless collar can give you a 40% bonus of defense. But if you don't have enough level or the armors craft a bunch of sleeping mist and keep attacking the monster.
After you finish the Lizard's treasure quest (in which you would have 2 nightmares of the Nameless) there's a 3rd nightmare where he ask you what you think or how you feel about him, each choice give you a different item, if you choose to be scared you get the Nameless Collar with 20% of protection, 2% of aim, dodge & crit. rate but -15 of sanity.