Automatic soft reset, no questions asked. I let Mustadio die my first time through the game. He died right toward the middle of Chapter 3, and then I read this cool thing online about how you can get Cloud from FF7 in your party, and I decided I wanted to do that, but uh, Mustadio had turned into a Power Sleeve.

I've let a few generics die, if it happens early on. For example, in the Gariland Magic City battle, right at the beginning, I like to let all the enemies Crystalize so that I can nab their abilities. If one of mine goes too, I don't worry because I can hire another right then. Plus, in that battle specifically, it gives me the pleasure of getting to kill Delita to make sure that he doesn't kill the last enemy and end the fight before I get mine.