How do pets work now? (not played since 2011)

[Mudkips]

I have 97 pets which includes the oozeling, little bat things, and whatnot. So I'm scared to accidentally 'lose' them.
What's this whole new pet ineterface? I accidentally used a [Sinister Squashling] because I'd forgotten that right click was 'Use'. Now I have TWO in my pet menu? Some pets say "(1/3)", wut.

Seriously, I'm so confused. Can anyone explain.

[ev0]

You're allowed up to 3 of each pet you in your journal. If you have over 3, you can sometimes right click and put them in cages to resell (like pokeballs).

Pretend the whole interface is kind of like "Pokemon", you queue up for battles (pets you own have basic abilities) as well as you can level them to 25.

[Mudkips]

But do you lose your pets if you fight when them and lose? Do they DIE? Should I refrain from ever using expensive pets in fights?

[ev0]

But do you lose your pets if you fight when them and lose? Do they DIE? Should I refrain from ever using expensive pets in fights?

Nope! You'll always have your pets, there's a "revive" button in the top right corner of your pet journal interface. Youtube some videos if you're interested.