"Based on my experience on normal, no-loss would be impossible (or at least incredibly frustrating) without a lot of luck in the beginning of the game. The low HP units you normally get when starting die like flies, and you don't have any powerful spells like phantom, resurrection, hypnotize. Isn't there a high risk of having to restart the game from scratch if you are unlucky with placement of high powered units and scrolls?"
Luck is always nice, and most people like to start with specific conditions but the begining can be done even if you are totally unlucky.
Inquisitors are garanteed, Paladins can be get withough a fight and with no extreme kiting. Later you can you the Emerald dragon from the Q for tanking - if you are REALLY unlucky and get no heal spell, you can still have priest
You will might miss good spells later a lot, but missing one or two spells is usually not a tragedy. Missing phantom is really bad, but you can have summons instead. Missing Ressurect can be helpd by phatomed paladins etc...