My interactions with the Marked Merks are all over the place, because by the time I hit the Foothills I'd already met Lusamine and apparently that throws a bunch of stuff off kilter. Also, I never lost to the them because by the time I went to the Foothills I'd already cleared the entirety of Harvest Valley, meaning that wiping the floor with the Merks was pretty much fait accompli. Here's my take:
1 - there's two "factions" of Merks: there's the veterans like Jen and Leofric and the new recruits, like Lus and the ones you actually fight. Apparently, the newbies are the bandits and the vets are SUPPOSED to be ok, but they're not, becaaaauuuseeee:
2 - Leofric is unadulterated trash. Forget the suckerpunch. He's a fucking commander of a mercenary unit, hires a bunch of thugs into it for a hard, dangerous, probably shit-paying job, and then fucks off on some sort of vision quest. That the Merks wind up the way they did is unavoidable. All armed groups are criminal groups. There are no exceptions to this.
3 - Jen is woefully unprepared for command, except possibly as a field battle leader. This is Leofric's fault, who, from the info we're given, continuously babied her (and not in the way she really wants him to "baby" her). This is further compounded by the fact that Jen doesn't think she's in actual command and instead is just keep Leofric's seat warm or some shit, meaning the Merks are never going to respect her as a commanding officer because she doesn't respect herself as a commanding officer.
TL;DR: Leofric is irresponsible trash, everyone (in-game and out) needs to shake off this delusion that Jen is in actual command of anything, and more Lusamine content plzkkthxbai.