I was stuck on that battle earlier today. The key thing to realise is that killing all the small enemies first removed the bosses defense, and you can deal heaps of damage in that window before she respawns then. Rinse and repeat. If party members get pushed into the water, call them back. Melia can defeat one of the small enemies with 3-4 ether attacks. Though to be honest, I beat the battle after many many attempts by using Shulk, Sharla and Dunban. I know it isn't the best combination for that fight but it worked in the end. Making use of the Monado art that damages all enemies around Shulk is extremely useful. I was level 74-75 when I won.
Anyway...
I just finished the game tonight. And wow, it was honestly one of the greatest games I've ever played. I've been waiting for another RPG that I really love since Skies of Arcadia, and finally it came in the form of Xenoblade. The ending was phenomenal. And the final bosses were the perfect difficulty- extremely hard, took me many attempts, but at no point did I feel I was being cheated. It always felt like it was my fault and I had to improve. Great game design.
If there was a graph of this game plotting quality against time, it would be a steady slope upwards. It just keeps getting better and better. Hopefully I can convince a few friends of mine to stick with it, I'm sure they'd love it.
The story was absolutely brilliant. I feel I understood it well, but now I can't wait to go highlight all those spoilers in this thread which I'm sure reveal a lot of things that I might have missed.
Then there's the beautiful graphics/art design (and I mean beautiful), character development, side quests, exploration, etc etc etc.
I could keep writing about this game on and on, but it'd be nothing new to anybody who is currently playing it for themselves. It's so awesome that Monolith Soft now create for Nintendo, if they make a game as good as Xenoblade for Wii U then... I'm already pumped.