Yes. The fact that there's magic in the world isn't incompatible with good world-building and doesn't mean "everything goes". Most fantasy books and video games understand that pretty basic fact. Also, leaving immersion aside, DnD 5E is a game with rules, and among other things it is built around the idea of managing resources and resting. Granting insta-rest after every fight breaks it. It's like taking loans in Monopoly.
Coming back to time,
The simplest solution would be all blood map-wide disappears on short rests, all bodies disappear on long rests (presumably some scavengers or good samaritans dealt with them).
It might be a quick and cheap fix, in terms of coding it. It could do the trick if the goal was to solve the bodies issue as soon as possible. But I think the goal should be to make the game overall good for when it's released in full, and such quick fixes now might end up having to be undone later on. What I'm saying is just that I'm wary of quick fixes, and I would rather have the core issues be addressed and solved first. Then, the other pieces should fall in place naturally.
The game should probably figure out how to really account for time. Or do so better. There should be a way to know what day/time it is.
A short rest should probably take about 1h, as per 5E rules. And then, blood could disappear after 1h too, regardless of whether we use short rest. A long rest should probably either take about 8h, or push us forward in time to "next morning at 9am". Then, bodies could disappear after 24h, or the next long rest after 2 mornings (or whatever seems appropriate), regardless of how frequently we long rest.
