It wasn't backing away. It was walking towards me, glitching into the same space I was (manipulating the lack of collision detection), which canceled my attacks as it kept following me via "not facing target/no target in view," while holding the bow the entire time. It was still able to attack with the bow without switching to melee, and I had to turn and walk away (as if I backed away, it kept moving into my space), which at that point, the moving away and shooting routine continued as normal. This repeated every time I would get close enough to attack. It was quite clever, but I figure if a player did the same thing and glitched a mob, this would be considered an exploit. This happened in a wide open forest environment not far from Therrin's camp in the northeast, so it wasn't cornered.
This brings up a separate problem. It seems like all the "Smuggler" types in the Central Veins don't abide by the "minimum range" being able to shoot a crossbow at point-blank melee range. These would switch weapons if they were hit in melee range though. The smuggler woodsman does not in this instance.
I'll see if I can try again and get better pics or a video, although I haven't used OBS or FRAPS in a long time.