Yes, Death Spawns spawn next to the NPC. However, selecting the option to avoid combat with non-targeted NPCs doesn't stop the script from attacking them, because they attack you. Even with auto-retaliate off, the script still attacks them.
Setting the option in the script to not respond to NPCs attacking you also doesn't work, because that's only for safing. Setting that makes it so sometimes my character is under attack by a desired NPC, but is trying to fight another of that NPC, but can't, because I'm already in combat. It just keeps clicking the NPC while under attack by a desired NPC, until death.
I can't find a way to avoid fighting those Death Spawns.