Ok I'm stuck on a game design problem.

I'm working to get the Vamps (humanoid) form into my game. So the question is: what gameplay purpose is there for transforming?

I'd like to implement it so that when you take damage or mess up, you transform back to the Vamps form where you're more vulnerable and less mobile. Then you have to survive in that state until you regain the energy to transform back.
As I write this out, I'm worried it won't be fun. Like if you crash into a building with no NPCs around, you transform back into Vamps form, can't do much, and are forced to wait until you can get back to Batty form to play the game. Maybe all the NPCs are alerted to your presence when you go to Vamps form?

Anyways... what I actually meant to write about here was figuring out when the player is transformed into Vamps form. I shouldn't do it every time the player takes damage, it would be too punishing. So I was thinking you get three 'lives' and when you take damage three times you revert to Vamps form.
But then I'd have a 'lives' system on top of the red orb HP system, wouldn't that be confusing?
The alternative is you transform back to Vamps upon losing all your red orb blood energy, and being in Vamps form replenishes it. But that means I remove the lose condition. Would that be bad? Do games need a lose condition? It would break my endless levels but no one likes those anyways.