1. Kefka dies. Naked defenseless woman dancing uncontrollably. Neutral terrain; plainly visible from the start. Any of KOS-MOS/Bryan/Duke can shoot and kill her well before the transformation wears off. She is a sensible priority target -- it's Duke's ability, so Duke's team knows that it's a limited-time transformation and the actual merc is presumably much more of a threat.
2. Chief's unprotected and helmetless head is being booted by 2x strength, 2x weight Duke.
So it's pretty much a 4-on-2 match from the start. Neither of the two can take KOS-MOS in ranged combat. Neither of the two can take Fou-Lu in close combat. And KOS-MOS/Fou-Lu have backup, which they don't.
3. KOS-MOS is unlikely to be severely affected by the cheese. She possesses advanced combat AI designed to instantly compute the most effective means to victory. She's not going to be running around like a moron -- she can calculate that the most effective way to secure the cheese is to eliminate all opponents.
4. Stealth and invisibility won't save Joanna/Boss. Bryan's cyborg vision enables him to see invisible enemies. See, for instance, the Tekken 5 ending, where he uses his robotic vision to hunt down and kill a cloaked Yoshimitsu. KOS-MOS has advanced scanning sensors (see, e.g., the dialogue before the Cherenkov battle: "All photon, lepton, hadron, and graviton scans read negative"). She is also shown to have robotic targeting systems in the few scenes where vision shifts to her perspective.
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another place and time, without a great divide, and we could be flying deadly high