I know I might be missing something obvious, but I’m combing through the SC with my players and we can’t find a definite answer.
So, we get how Disposition is generated, what it represents, and understand that each time someone’s Hit Points are reduced, Disposition should be adjusted accordingly (SC p. 59) - most of us have played Mouse Guard and Burning Wheel before at least for a couple of sessions.
However, we did not find explicit confirmation, whether regrouping as part of the Defend action actually restores Disposition in addition to Hit Points. On one hand HP can’t be restored past the initial maximum, which is based on the Disposition distribution (SC p. 68), but under Fog of War of the Too Much To Handle section (SC p. 81) it does say that at the end of a conflict Might should be compared between participants still standing, suggesting that despite Disposition reaching zero a loosing side could still have non-knocked out members.
On a related note, it would also suggest that if all enemies are knocked out it would be possible to reach original intent despite differences in Might? So if for some lucky reason the party manages to knock out a dragon before it performs a successful Defend & regroup, it would then not be included in the Fog of War calculation… on the other hand the detailed descriptions on the same page above are clearly stating that is not the case, so I’m assuming Fog of War to be only player-centric and used in case of varied Might levels on the players’ side, not the opposition since minions can always soak up boss’s hits?