This is a great execution of a clear idea! I had a lot of fun playing it. Also, three thoughts while playing:
1) it would be a huge quality of life help if you could tell which "damage squares" were being generated by which enemies (maybe hovering, maybe color coding).
2) balance-wise, I think the exploding squid/clouds should be introduced later in the game. Each squid thing takes a whole turn to kill safely, and that's only if you're in the right position--meaning that having lots of them early can really stretch out how many turns the player is passing, just waiting for safe cards.
3) also, it felt non-intuitive to me that killing the last enemy on a level doesn't instantly end the round...leading me to a "feels bad" defeat at the hands of one of said exploding squid.
Also, small provocation -- there seems to be no reason to limit this mechanic to a tiny grid! I would totally use this "hand of chess pieces" mechanic to move around a big dungeon.