It all depends on how fast it grows.
What if the player is left without spells and hp after a hard battle
(I suppose the larian bends and remove the healing from the food).
In my opinion, this is terribly overcomplicated.
If the player had just completed a hard battle, a balanced game would mean the next battles they face
should be relatively easy. Thus, a player could get through them with basic attacks and cantrips.
In addition, there are potions and scrolls to heal and cast leveled spells. With the current rest system, after Larian fixes it so that only magic-users can cast scrolls (as in 5e rules), scrolls will be pretty useless aside from increasing your wizard's known spells. If you can long rest infinitely, then you'll have access to all your spells for every battle and thus why would you use scrolls? (Again, assuming Larian will fix the scoll-usage rules)
In the case of such a limited rest, fights such as the bulette or the minotaurs would be much less frequent. Instead, you have to put in simple fights with trash mobs (which are usually much less interesting).
Now how are you going to balance them? Do you assume that the player will be approaching the fight with some resources or maybe he had bad luck in the previous match and will have to rely on cantrips?
If you assume that a player has no more resources then fights can be trivial.
If you assume that the player still has some spells left, the fight may be too difficult.
Now we are adding difficulty levels on which we need to balance it.
Too easy or too difficult fights are an easy way to get bored.
In terms of design, it is a nightmare. You have to consider possible group compositions and a few other factors.
In the game, you are not able to choose next fight depending on how the player is currently doing.
