Wow, that's really confusing to me. The card stops having a special ability once it moves from the side battle to the main battle? Here's what the rulebook says:
"Surviving characters that return to the main battle bring their enhancements to the main battle. Any ongoing effects of special abilities are applied (e.g., immunity) to the main battle unless that special ability was exhausted in the side battle (e.g., a draw a card)."
Ongoing effects keep happening, that makes sense. You don't re-trigger the discard and draw and end battle abilities on Heavy Taxes, that makes sense. But why does negating it with Cov of Noah not negate the original discard/draw/end battle?
But even if I accept that, then why does the "more than one side battle" rule kick in if I were somehow able to play something like the Warriors Flaming Sword ("The effect of the last Enhancement Card played is interrupted and prevented.")? I'm not causing a new battle, I'm just stopping the original one from ending.
Man, I've had since 1996 to figure out side battles and I'm still confused.
First off, allow me to clarify that I'm trying to think like an Elder/PTB. So I'm looking at it from the perspective of nipping any possible ruling anomaly in the bud.
Initially I would see it just like you, Tim. HT is in play. CoN negates it. Side battle continues. And while I agree with you that this doesn't necessarily count as another side battle, if abuse occurs then it may be considered another side battle. For example, I've been toying around with T2 side battle decks for years and have found one that sort of gets around the "1 side battle per turn" rule. As soon as I start posting any detail about it, a ruling will be made to revise how side battles are counted.
Back to your example: the side battle continues with Vitellius having special initiative.
So the bottom line is you should always wait for the PTB to chime in.