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Relatedly, “party is baffled when predatory animal becomes feared and flees at 1/2 HP.” I mean, the dire wolves weren’t attacking for fun, they were looking for a meal and found ostensibly snack-shaped things. If you want the pelts, make certain they can’t escape. Sentinel, nets, Entangle, etc..
It's called fight OR flight.
You gotta make sure to remember that some animals don't know how to back down. This is not in hunting scenarios but general confrontation some animals will get completely caught up in aggression and self destructively begin hyperfocusing on murder mode.
Dogs IRL do it surprisingly often. Humans are also known for it. Adrenaline is a bitch.
While that is realistic, it shouldn't happen all the time because it makes for frustrating gameplay.
Fun is still the most important aspect of a game.