It's like a game rules. You always has a choice to run from enemy and play save, or face it and take damage then level up.
Yes. You need to take damage in order to level up. You just need to think how to decrease damage.
Said your enemy defense, you should attack. But when it use power attack, you better defense.
Sometimes you need to defense to make less damage.
Thus, i though life is realy like a game except the fact that God doesnt play with dice. So why so serious? =)