With the cute dogs fight, the combat ends not because they couldn't see you, but because the flip into zombie dogs. I filed a bug in the bug thread noting that the cute dogs probably shouldn't be engaging you at all, instead luring you in before they go zombie on you like a trap.
I've tested it a few times and every time the cute dogs engage for one turn, combat ends and they flip to zombies, then they re-engage if they see you. They also regenerate to full HP.
