Excessive boss retreating can be silly. Retreating once isn't that big of a deal, but it does get hilariously ridiculous when the same boss character retreats multiple times.
Funnyly enough, a boss retreating to fight another day seems less weird to me than a player character retreating when their HP drops to zero and never being playable again (despite their injury clearly not being that significant enough to have any effect on the custcenes these characters are in) wheras other playable characters just dies. I get the logic that these "retreaters" get plot armour due to their plot significance, but I don't see why they can't be used again after eventually recovering from their injuries a couple of chapters later (especially since their injuries aren't
that fatal). Though if every single playable non-Lord playable character got the same treatment, it would at least be more consistent).
In terms of story-relevant characters on the players side, I feel like the most ideal way to handle these characters is to make the playable characters that are truly relevant enough to need
massive rewrites, as their deaths would fundamentally change the story being told, characters that automatically gives you a Game Over if the die (2,3 or even 4 characters besides the main Lord can be given this treatment). Any other characters that could have cutscene relevance on the playable characters side can be written around (by having any cutscene they have with the main characters have an somwhat different version written. If they do contribute something plot significance, that can be taken over by a different character if said character died or it could just be ommitted depending on how important it to the plot) or be just NPCs, either permanent ones or ones that only becomes playable after they don't need to be alive to kep the story functional. Another thing that can be done is to make plot-relevant playable characters similar to FE6 Merlinus (where they always come back no matter how many times they "die").
So the story cutscenes revolving around a mix of units that gets you Game Over if the die and important ally NPCs would be the most ideal.