Hi, just letting you know that I'm still experiencing this problem in Beta 4.  It seems to be a lot less frequent, but it is still occurring once in a while.  Also, when this happens my game framerate still drops to 1 fps and I have to exit the game and restart it to fix the problem.  Please let me know if I can post any details that would help you to track this down.

Yes, happening to me too; I'd say maybe once every six to eight battles or so.  Needless to say, I save before each battle. 

I have noticed that it happens less frequently with shadows turned off in video settings, though it does still happen.  Also, I at least have found that Alt-Tabbing to the desktop and then back to the game will get rid of the fog for the battle so it can be fought properly, however I then run into lag problems immediately or soon after and need to save, exit, and restart the game.