Why does hitbox made with region3 randomly stop?

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This

For easier reading!

The problem

I think what's going on in your region script is your calling RegionPart.Parent on objects you find in your region3. The problem with this is when objects get removed inside the area they are still referenced in code, but their parent is nil aka deleted. To get round this problem i would change the following code:

local RegionPart = game.Workspace.RegionPart
local pos1 = RegionPart.Position - (RegionPart.Size / 2)
local pos2 = RegionPart.Position + (RegionPart.Size / 2)
local Region = Region3.new(pos1, pos2)

while true do
    print("Started/Restarted Loop!")
    wait()
    local PartsInRegion = game.Workspace:FindPartsInRegion3(Region, RegionPart, 1000)
    for i, RegionPart in pairs(PartsInRegion) do
        if RegionPart.Parent:FindFirstChild("Humanoid") ~= nil then
            print("Found the Humanoid!")
            if RegionPart.Parent:FindFirstChild("Sword") ~= nil then
                print("Found the Sword!")
                if RegionPart.Parent.Sword:FindFirstChild("Handle") ~= nil then
                    print("Found the Handle!")
                    if RegionPart.Parent.Sword.Handle.Active.Value == true then
                        print("Decreasing RegionPart's Health!")
                        RegionPart.Humanoid.Health = RegionPart.Humanoid.Health - 30
                    end
                end
            end
        end
    end
end

To:

local RegionPart = game.Workspace.RegionPart
local pos1 = RegionPart.Position - (RegionPart.Size / 2)
local pos2 = RegionPart.Position + (RegionPart.Size / 2)
local Region = Region3.new(pos1, pos2)

while true do
    print("Started/Restarted Loop!")
    wait()
    local PartsInRegion = game.Workspace:FindPartsInRegion3(Region, RegionPart, 1000)
    for i, RegionPart in pairs(PartsInRegion) do
        if(RegionPart.Parent ~= nil) then 
            if RegionPart.Parent:FindFirstChild("Humanoid") ~= nil then
                print("Found the Humanoid!")
                if RegionPart.Parent:FindFirstChild("Sword") ~= nil then
                    print("Found the Sword!")
                    if RegionPart.Parent.Sword:FindFirstChild("Handle") ~= nil then
                        print("Found the Handle!")
                        if RegionPart.Parent.Sword.Handle.Active.Value == true then
                            print("Decreasing RegionPart's Health!")
                            local HumanoidChk = RegionPart:FindFirstChild("Humanoid") --// check to see if this part has a humanoid if so lets damage it!
                            if(HumanoidChk ~= nil) then
                                RegionPart.Humanoid.Health = RegionPart.Humanoid.Health - 30
                                --// this would be better and simpler to do the following
                                --[[
                                Un comment this section after removing the above code as both do the same thing.
The only difference between is your way will damage humanoid regardless if the humanoid has a forcefield or not but the way below allows for immunities with the ForceField aka doesn't damage the humanoid!
                                HumanoidChk:TakeDamage(30)
                                ]]
                            end
                        end
                    end
                end
            end
        end
    end
end

The rest of the code/scripts look fine!

Reference: https://developer.roblox.com/en-us/api-reference/function/Humanoid/TakeDamage

Hope this helps!