You indeed can be attacked/killed at any time, no matter if you're set to or not. Hope it's a bug. I've been killed twice, and accidentally killed one person while using Siren Song on a Ghost Book clone.
Shaman Girl Jia gives two monster quests. At level 177, I was assigned to do the low level of the two, the Ghost Book clones, and each cycle gave a little over 2M base experience and forgot about the TM (about as much, I think). It was five cycles. Got EE'd twice. The other monster quest is the Tritch clone, but I don't know the level requirement or experience it gives. They use Banish...
On a sidenote, if you can't damage each other when partied, this looks like an AWESOME place for AoE characters in a 2.5 party. The rooms are FULL of monsters, it's extremely packed.