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Its like saying i negate the fact that you are an evil character.
Actually I am of the opinion that "Negate Last Enhancement" abilities WOULD negate DS, as DS was the last enhancement played, regardless of what it is now. "Negate AN Enhancement" abilities would not negate DS however.
Negate Enhancement cards can't target DS because he is now an EC.
Placing a card in the discard pile removes it from play, but does not remove the ability to negate it by (1) interrupting the battle or (2) interrupting the last enhancement played in battle. However, a "negate last enhancement" negates the last enhancement regardless of its current state (in play, discard pile, converted to a character, etc.).
There is one important point I just realized. It never truely converts. It says "treat as." Does that still make it a conversion ability?
That's bunk. How can a card that targets Enhancements for negation target a Character? If it's in the Discard Pile, it's still an Enhancement so that's not a valid argument for why it should work on characters.
It should. The negating card clearly targets Enhancements. DS is no longer an Enhancement. It should not be targeted by a Negate Last Enhancement.