Good proposal, there are just a few holes you need to fix. Holozing is a virtual game within its own world, meaning that the creatures of Holozing are not part of the fauna but are a game, like Digimon or Pokémon would be in our world. All of this takes place in the 2040s, so there isn't much point in taking a medieval approach to the matter.
I think you should look a little more to Digimon for inspiration than to Pokémon because the creatures are digital.

Anyway, I find what you're proposing really entertaining. If you like, we can share ideas since there isn't much canon for the game either.