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Sorry, I interpreted the "----" in your hypothetical battle as "several rounds later."
Anyhow, yes, you will sometimes die fighting Xagor; IIRC he can critical with Dk-Force, which means instant death. But it didn't take too many attempts, and getting lucky is always a big part of single-character games anyhow.
It's funny, I really don't like the core FF games at all. But I like anything I've played with the Final Fantasy title appended on to ship more units, and I like most of Square's other older stuff. So it would be interesting to see whether I take to MQ or not.
I was up to the third world when, to gather data, I sharked the hero to max exp... and only then realized it would affect every save I had x_x
So I had to start over...
(levelup formula for level x, btw, is 13(x^3)+61(x^2).)
EDIT: To clarify, the sharking was in a new game that was NOT planned to be saved; the only code I'd ever use in a challenge game is the one necessary to establish the challenge (here, the ally petrifier).