Video of your game here:
Thanks for the playthrough :)
Some thoughts:
1. The reason you're not taking a lot of damage in certain cases is due to the blood on the ground increasing your armor value. In hindsight this mechanic is rather unintuitive and could be cut out without missing anything. (It's the "blood" bar on the HUD, with the provided armor resistance next to it.)
2. The first few floors are just way, way too easy -- you can easily march through hordes of enemies without needing to turn your brain on due to the relative lack of threats to be found. At the Workshop level, where the game unfortunately crashed, you would've begun finding ranged attackers which would have significantly upped the difficulty level.
3. HP is actually regenerated each time you or an ally deal damage, not when an enemy dies. I wonder how I could have made this more clear in the UI? Hm.
4. Cutting out diagonal movements is an interesting idea, one which I'll certainly be visiting if I start working on this again.