Yes.
The Tests have no special stipulations on the consequences suffered during them—they should be treated like any other part of the game. In particular, sections G16–19 all contain a paragraph starting with the following text:
The characters are not dreaming; the Frostmaiden's magic has teleported them from Grimskalle to this camp.
This quite clearly suggests that the events of the Tests are—short of further stipulation—the characters really being in those locations and experiencing the events.
For example, the Test of Endurance gives the characters the 'opportunity' to gain levels of exhaustion:
The march lasts 14 hours. Party members can weather the first 8 hours. At the end of every hour after that, each must make a Constitution saving throw. The DC is 10 plus 1 for each additional hour that passes (DC 11 at the end of the ninth hour, DC 12 at the end of the tenth hour, and so on). On a failed saving throw, a character gains one level of exhaustion. Any party member who completes the journey with four or fewer levels of exhaustion passes the Test of Endurance.
Emphasis mine. Unfortunately, this is immediately followed by the following:
At the end of the forced march, King Jarund orders the tribe to pitch tents and start campfires.
The Test Ends. Once the Elk Tribe camp is set up in its new location, everyone with a glowing symbol of Auril hovering above their head is teleported back to Grimskalle, appearing in the room marked G17 on the map.
In this case, the characters only have as much opportunity to recover from any exhaustion suffered as they have time before the camp gets set up. While this does leave room for the characters to attempt to delay this event through interacting with King Jarund, thereby potentially giving themselves time to benefit from a long rest—though this is a little far-fetched (without some creative use of enchantment spells...) and could quickly get out of hand.
Without strategies such as this, it seems from the characters will have to recover from the events of the Tests normally, either by taking long rests or by expending resources.
However, this appears to be the intended experience.
This Frostmaiden is indeed a cruel mistress, and the persistent nature of the challenges posed by the Tests add an element of attrition to passing all of the them. This makes passing all challenges harder than being able to pass each challenge individually if attempted together, which makes the process feel like a collective, singular challenge, and also may help with the pacing of passing the challenges: the characters may need to take a moment to collect themselves and regroup after completing a Test. Alternatively, characters who discover this may strategise to attempt the challenges individually or in smaller groups—though your results may vary.
You can, however, as always, change this to suit your needs.
If your players are finding the level of attrition too tough, or the consequences of the Tests are simply leading to an over-reliance on resting which turns mounting tension into a sequence of boring time skips, then you can decide that the consequences of the Tests should be confined to their own events: treat each Test as an isolated challenge.
This approach works because each Test is a different kind of challenge, and the challenges presented are enough to stand on their own without conferring penalties on the experience outside of the Tests. It also helps alleviate the issue of players feeling that their lack of knowledge of what a Test will involve doesn't unfairly punish their efforts in the other Tests.
In particular, if the characters attempt the Test of Endurance first (and suffer some levels of exhaustion), this can severely disadvantage them in the other Tests unless they manage to recover from the exhaustion before attempting them. Of course, this does detract from the sense of these events staying with the players (such as a character having to cope with a newly gained form of indefinite madness acquired in the Test of Isolation).
Something to note: the Test of Isolation suggests that it might be a good time for the slaad tadpole to emerge from a character with the Slaad Host secret. If you decide to have the consequences suffered during the Tests be temporary then this can go both ways:
- The tadpole's emergence could be an exception to the otherwise-temporary consequences suffered in the Tests. This can surprise the characters in a way which makes the event more impactful, particularly if it's not the first Test they underwent.
- The tadpole could emerge during the Test, but the event could be undone once the Test has ended. This could be confusing and disturbing to the characters, but creates a way of revealing this secret before it's too late in an interesting way, giving an opportunity for a powerful story moment in which the (bleak) situation is confronted.
As far as the adventure is concerned, though, there's nothing you missed: the Tests are as real (and permanent) as the rest of the adventure.
How it went at my table
I try to approach material as it is written, until given reason to deviate. As alluded to, in my sessions, my players unfortunately decided to attempt the Test of Endurance first. At the end, there was one character each with 1, 2, 3 and 4 levels. This left half the party (3+ levels are brutal) pretty heavily disadvantaged, causing a bit of a divide at the table: two of the players (the Wizard with 4 levels, and the Cleric with 1) felt that the right thing to do was to retreat to rest, then return later, since the party was now much more vulnerable. However, everyone was in agreement that this would both kill the pacing of the adventure and feel inappropriate from a narrative perspective: like giving up, without necessarily suffering consequences for doing so.
Although this wasn't brought up (my players are generally very dedicated to good roleplay and appropriate secrecy of information), I was aware that the player with the Slaad Host secret at my table was a little stressed, since he knew that his days were numbered.
After experiencing one of the Tests, it was quite clear at my table that the persistent nature of the consequences suffered during them did not benefit the story, nor provide an interesting challenge to the characters. So, taking the advice of the book:
Nothing in this adventure is too sacred to tamper with and repurpose to serve your own needs.
What followed caused a dramatic shift in tone—for the better. We decided that each Test was, in fact, a dream of sorts: the situation was manufactured—a figment devised for the challenges and nothing more, with all effects of the Tests cleared from the characters once they end.
This also helped to explain how each Test can be attempted multiple times (by different characters).
The party was able to wholeheartedly go into each Test as a united group—since that gave them the best odds, they figured—and there was no attrition which interfered with the progression of the story (and attempting the other Tests).
As a result, all of my players passed the Tests as a group—but before that...
The Test of Isolation was a great roleplaying opportunity for my players. They had the chance to get very creative in having to occupy themselves for an incredibly long time, as well as having plenty of time for conversation prompted by idleness, shared meals, or their activities—whittling an old family pet, for example, was a fantastic way for one roleplay-savvy player to prompt another to start a conversation that revealed some juicy backstory, allowing the characters to bond organically through sharing and relating their experiences. This made it even more impactful when that player went missing on the third night, despite advantage from inspiration—which the players were earning liberally for their efforts.
However, this wasn't the end of it. I decided to have the slaad tadpole emerge on the final night of the Test of Isolation. As before, the events of the Test were treated as 'imagined': they were returned to Grimskalle exactly at the moment they left, with no change besides new memories. This achieved a number of things at once:
- When the test ended, and the Slaad Host character (who was once again alive) had the chance to tentatively explain what he knew of his condition, it dawned upon the players that they now had a timer to work with: if events in the Tests are supposed to behave normally for the purposes of passing them, then the tadpole would emerge approximately six days from that moment—that's how long they had to find a cure, something that all of the other characters wanted for him.
- The way in which this secret was revealed gave the characters the opportunity to experience the peril and urgency of the situation in a way which complemented the character's reserved, selfless nature: this secret wouldn't have been revealed by the character, who didn't even consider burdening the others or jeopardising their objective by spending time and resources looking for a solution.
- The character who went missing wasn't permanently debilitated (roleplay-wise) by the form of madness she suffered; this event was dealt with at the end of the Test in a minor way, with the other characters being relieved to see her alive, and consoling her after the traumatic experience—instead, she was able to participate in the dramatic realisation along with the other characters.
In conclusion, the core treatment of the consequences of the Tests lead to issues with pacing and narrative satisfaction, and the decision to have the consequences of the Tests be temporary allowed for the adventure to progress at a much healthier pace, as well as turning what could have been a crippling blow to the characters into a powerful story moment which left them with more drive and urgency than they started with.