Patch: Selectable Script

Using this patch, I've never seen a monster use the Battle or Special commands. All they do are the 4 choices from the control list (assuming Battle & Special aren't selected as any of the control commands.) They don't use Battle or Special when muddled either. It seems to remove those from the monster algorithm entirely, at least as I've seen so far. Isn't that pretty much a game-breaker?

It does remove them; they'll only use them if "Battle" or "Special" is set in their control list.  That's probably why you're running into trouble, since you used that Sketch/Rage overhaul that uses the control list too; you either need to give the monster one or the other (or both) or have it be a non-physical attacker.

Alternatively, you can write traditional combat scripts for monsters that don't have the Battle or Special spells in their control lists and set them to read it with the Special flag.  The only advantage Collosseum mode has is more script space (since you can have monsters without scripts) and being able to randomly pick from four spells instead of three.