[unknown]
Ah, my bad. I forgot about that one. You're right, he did lose the war intentionally.
Hmmm, they did explain the reasons thoroughly later on, which was pretty reasonable I think for the context of the story.
SPOILERS if you are interested:
For one, he was already severely injured then because he went to the River Styx in an attempt to save a companion of his. But the River Styx was ruled by the God of Death which is one of the two strongest main god in that world, so he got crushed easily. But before he could be killed, he succeeded in convincing the God of Death of a certain plan, so they started conspiring together.
At the same time, from the God of Death, he learned that the gods of the Order Faction would not allow the Undeads to take possession the entire world because it would threaten the base of their believers. (Order Gods derive their strength from the faith of believers, so a huge massacre pretty much threatens their existence.) They wouldn't interfere if it's on the scale of something smaller as they would have a pay a pretty heavy price to descend to the world, but if it comes down to it, they would still be able to crush the Undead Army easily. All in all, his original goal of dominating the world with the Undead is already futile and they were damned for utter destruction if they were to continue down this path (not to mention he didn't really intend on dominating the world. He only wanted to exact vengeance, but the people that had gathered around him were pretty extreme). But if he were to announce that "let's stop the war and make peace", his supporters, which believe strongly in the aim of creating a world of Undead, would just overthrow him and a new person would be installed in his place.
So, he decided to just fake his death (kind of) and make his succession unclear so that infighting would break out within the army, and this way, they would just collapse themselves. At the same time, the Order Gods wouldn't have a reason to descend and wipe out the Undeads too, so happy ending.