I agree, this works better for the semifinals and not a heat, since I think a "loser's melee" is better saved for later in the tournament. Maybe once they get down to 4 after the melee, then do a round robin between the final 4 and then the championship battle. Combining the ideas of the posts before me:
All in all, it would add up to 8 episodes for the heats, then a 2-hour special to cover the semifinals all the way up to crowning a champion. That matches the same number of episodes that BattleBots got in their second season after revival, and both series got the same number of episodes for a first season.
Plus, with a total of 11 fights across the 2-hour finale (whereas a normal episode has 9) that would leave a bit of extra time for a couple exhibition battles, maybe a free-for-all rumble just for the crowd like how BattleBots does it.