I agree that there should have been a punishment in place for losing the scenario to the "timer". I like the idea of the punishment having a little randomness to it, such as rolling a die. I'd probably have 3 tiers.
Roll a d6:
1-3 = banish a random non-basic card
4-5 = (something in between)
6 = lose the latest feat acquired
Although, I do not let my groups "turtle" either. If they don't "play" they don't play! I'd like to see some other ideas for a system like this!