Thanks for your feedback! We have posted this list of item locations in case it's needed, though it will have spoilers naturally.
Apologies for getting so technical in the below.
The intended item/upgrade loss behavior is:
* If the player's health after hit is > 0, respawn at last soft checkpoint and lose nothing.
* If the player's health after hit is = 0, respawn at last save point and lose all items collected since the last save
Of course either of those is a respawn, but hopefully that helps explain what's supposed to happen "under the hood."
I will add that sadly, the first upload DID have a bug which caused some save weirdness similar to what you describe. I've since inserted failsafe code that I hope will keep it from happening in future versions.
If you're seeing behavior otherwise with version 0.9.7 ( and you're able and willing, please find me on the MVM Discord as kkairos and DM me your most recent save file, which should be under AppData/roaming/missingcatspleasehelp/savegame.sav or a similar folder for Windows.
Sorry for all that. Thanks again for your feedback and your kind words! As we look at a roadmap to 1.0 we will cherish your suggestions!