No, this is not a bug and is working as intended. The outhouses inside dungeon-like areas are intended to be "out of order." They're only there to serve as respawn points inside the mine; they can't be used to teleport into the main outhouse network. I'm assuming you're talking about the Nanny Demon, which is mentioned in a question here if you want any tips about it for a future replay. DeathSpank is a hack-and-slash game, so it's intended that enemies respawn after reloading the game (and they respawn after a certain period of time even if you don't).
Depending on how many sidequests you have done already, you may be making a few more trips into those mines. Here are some general tips:
- Before you head in, buy some potions from Bong. It's always good to have some in case of an emergency.
- Break open barrels! I did this constantly as I played and it kept me decently stocked on heal-over-time food items. The food items you get from barrels auto-level with you, so when you're lower level, you'll get Pizzas, and it'll scale up through French Fries, Milkshakes, and Hamburgers automatically as you get higher.
- If you're impatient, you can buy some food from Juan the food vendor. He's just outside of Pluckmuckel. He only sells lower level food, but it's pretty cheap, and will still be useful for you if you're still around level 11.
- Kill chickens! If all else fails, you can fall back on your supply of drumsticks. I had to do this once when I was stuck somewhere without any other food items. They don't heal very much at all after you're higher level (I had to eat like, 20 or something) but they'll do in a pinch if you really need them.
- Don't forget to block! If you need to really just run through somewhere, hold down Block and when it decays, hit the Block button again. Rinse, repeat. Additionally, learning the timing for a Perfect Block will really help you throughout the game. It'll automatically fill your Justice Meter, letting you unleash your special attack. Take a moment when you encounter new enemies to watch their attack pattern so you can do this.
The boss is dead though and will not respawn, so mostly, your future trips into the mines should be pretty painless. Good luck, fellow Dispenser of Justice!