Illusion of victory.

Well, personally, I only chose the upgrades I needed, and I left/killed the rest for experience. That way, I only used that Fortress once – I immediately ran to the left side of the Dungeon. I upgraded, cleared everything from left to right, and then went to the surface. It took about a week or two, no more.

So, if a player is in a town, do they lose reinforcements that turn?

It seems that way. You can, of course, artificially pull him out, try to send reinforcements directly to the town, but... For now, that's how it is.