For god's sake, Rand started mentioning AoL people who were decimated by her!

Nynaeve asked him if he was saying he couldn't beat her, and he evaded the answer.

He wasn't physically scared of her (especially since he had the CK, but even otherwise, Rand isn't in anyway a physical coward). What he was afraid of was that whatever he planned, she'd have prepared.

And the idea that someone who sits on a table to play mind games will not be prepared for the most common mentality of all, hit and run, is plain ridiculous. Especially when there are hints that Graendal chose where the table would be placed, and had ways of knowing what Rand's next move would be.

As for the thematic issue, Graendal's being alive would only reiterate and strengthen the point of this scene... namely, thoughtless sacrifice that is justified by the ends is wrong.

The point of this scene was never to show that Rand was cleverer than Graendal. The point was to show that Rand's global startegy of not caring for people and just gunning for the villain was bound to fail.

This tactic will not work with the Dark One. That point will only be strengthened if Rand failed to kill Graendal.