First, be sure to edit your original post rather than double-posting if no one replied first
Second, Prof U (who is an Elder too, so that helps your second post
) is correct that if they are protected from discard in general, then they are protected from
any discard, including by game rule for having a toughness of 0 or less.
Third, decreases and increases are added together to determine the final */*, and you
can be negative at any point in either number. All negatives get added to all positives to determine the final result.
Finally, when a character is placed in battle, his ability resolves
before the game checks for discard by the numbers (which he wouldn't be protected from anymore).
So all of that together, we get:
If a character is protected in territory from discard and has a toughness of 0 or less, like in your scenario, then they will not be discarded by game rule while in the protected location. Game rule states that a character has not entered battle until they are placed in the field of battle for a rescue/battle challenge or a block
AND their ability resolves
completely. So the ability resolves
before the character is actually in battle and no longer protected. At that moment is when the character would be discarded by game rule for a toughness of 0 or less, if applicable.
So, to your example of a decreased Babylonian Soldiers, if Headquarters of Riblah is out then the Babs are protected from discard (including by game rule) while in territory. Once the Babs are selected to be used to block a rescue or battle challenge, the player places them in the field of battle and then completes their ability
fully. In this case, this may result in an increase of X/X.
After all abilities on the Babs resolves, then they are in battle and no longer protected. Now, there is a check of toughness, and if the total of the decrease (which
can send their toughness negative) added to the increase (which
must overcome the negative and bring the toughness to 1 to avoid the discard) is 0 or less, then the character is discarded by game rule. Note that the battle may not be over if you somehow played something that would give the hero special initiative (as that is resolved as normal), but your Babs would be discarded and you couldn't play anything to stop it (game rule causing the discard, not an interruptable ability).
I would like to know what happens if an evil character has first strike?
First strike
only comes into play in Battle Resolution or to determine initiative. If a character is discarded
before Battle Resolution, either by abilities or game rule, then it would not be used. If your EC were protected from discard and survived to Battle Resolution, then it would be used to determine the winner as normal. Otherwise, it has no effect.