I could have sworn there was some patch that fixed life drain in battle. Right now the Nosferatu lifedrain effect only works if you have map animations on, or if you have the literal runesword/nosferatu tome. So if an Iron Sword has the Nosferatu effect, it won’t drain life properly on hit.
Does anyone know if it was ever a thing? Am I crazy?
Never heard of it, but it’s a great time to actually make that work! 
Considering that Pi basically got this to work with a functioning Sol in FEIV, it’s clearly doable. I don’t recall a patch to actually do it existing, though.
I do know that there’s some kind of 0x85 flag in Nosferatu’s spell animation data (85 XX) that causes the HP bar to fill back up after stealing the HP, but that’s all that I know about it (thanks Hextator, circa 2007).
Never done, though I suggested a way to do it – basically have the animation scripting thing that FEditor uses to automatically wait for/update life of attacker at the end of every animation.