1: When you say compatible with "Gogo and the Cursed Shield", do you mean the original or your fixed version?
Both, because the flawed part of the patch that I found a fix for doesn't collide with this patch. The only conflict here involves a JSR that is modified by "Gogo and the Cursed Shield", which is merely shifted by my patch.
2: What happens if you X-Zone the Soul Savers after applying this? Do they stay gone for the whole battle or do they eventually revive? I don't have a save at that spot to check this myself.
They'll stay gone until one of your characters takes another turn. I tried this myself to see what would happen if Wrexsoul was in mid-Zinger when this occurred; your characters won't be able to do anything meaningful in terms of attacking or killing each other to make Wrexsoul evacuate the possessee, but you can just heal and that'll cause the Soul Savers to respawn.
What happens is, they normally revive as a "final attack", which is what they do when they die, but X-Zone stalls all final attacks for one turn.
Technically, yes in the game's internal terms. However, I think that the logic here is that what is being represented here is that this undead creature is hit with an instant kill attack as opposed to a spell effect. Think of it like the red skeletons in Castlevania. They are not immune to being destroyed by your weapon, they simply reconstitute themselves in the event that they are "killed". So in effect they are dead for a moment, they simply come back like the PCs in Dead Souls.
Now the Life 3 spell can be thought of in the fiction of the game as a program much the same as the actual code that makes it up. The spell has one function: if the entity I'm attached to is killed, then I will cast Life on it. It doesn't know the nature of the being it is used on any more than the regular Life spells do.
If you want to look at it that way, go ahead, but I really do think it's a bug. Think of it this way: there's a way to make one of your characters gain the Undead status, by equipping it with the Relic Ring found in Owzer's House. If that character is attacked by a killing weapon, they won't die at all, but will instead regain all of their HP. An undead enemy's reaction is basically the same, and it also regains full HP, but the process looks different and the healing is invisible to the player. So I think the mentality here is that the undead enemy shouldn't have died at all, it just looks like they did. But, in the interest of money idioms, a penny for your thoughts.