Thought this was a bug, but it's probably a feature

[Corvus Corax]

I added a L12 priest with Hardiness 4 to my covenant yesterday about the same time as I patched up to v. 1.001. Well, I began to notice that my guard monsters and covenant members and my character seemed to be losing hitpoints. My covenant members were constantly healing at the lifestone, which, itself, kept dropping to 75%, then going back up to full after a while (then the whole process would repeat). "Wow, a bug associated with v. 1.001," I thought. Then I noticed that the new priest was constantly casting "Hardiness" on everyone in sight. I assume that the decrease in monster/covenant member hitpoints is an illusion. Their hitpoints are actually being increased, but their life has yet to fill the bar. The covenant members constantly heal and the monsters appear to get their hitpoints back when the spell wears off. The decrease in lifestone hitpoints I attribute to two possiblilities: (1) the constant healing by all convenant members draws down the lifestone, or alternatively, (2) the priest is also casting "Hardiness" on the lifestone, producing the same illusion of decreased hitpoints that I see with the covenant members and guards.

[Shadow]

Yeah, it's basically an illusion. When hardiness is cast on someone, their max health will go up but their current health will stay where it was. So relative wise it looks like you have been hurt, even though your health hasn't gone down any.