Mainly it's transformations by failure or randomness, but there are some encounters where you can choose whether or not party members get transformed intentionally, usually in exchange for some supplies.
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To be fair, the main premise and goal of the game is to get the humans to safety, Preferably still as humans.
I Played a bit of the game and for me, it checks out.
Though as you've said, pretty much rewards the players for failures, well, if you were gunning for those anyways.
But again, with the games actual setting, you can also do a normal run. I suppose there should be more incentives to actually try to go for a regular run, like perhaps some bonus for humans for the consecutive runs. Though haven't gotten deep enough to tell whether or not there are actually incentives in the game for a regular run.