Apologies, I was remembering wrong. I USED to have Mahir take it away after the first loss, but I stopped doing that as using the charm unlocks another ending, and having it so highly gated was a bad idea; I wanted to give a higher chance of people ending up using it, one way or the other.
That said, I did just test it out a bit. Everything works normally on ent dist 1 after 1 defeat. Same goes for all three crowds in the final ent dist 3 rush, including the striker one. No hypno while charm is equipped. Had it on zero battle hypnos though. Would you mind tossing me a save file on catbox.moe or whichever site you prefer? Zip up the "filex.rpgsave" AND the "global.rpgsave".