I played the boss level at least 20 times and couldn't figure out how to beat it, it just kept starting over (which I'm guessing was supposed to imply that I died) and no matter how many punches I landed I couldn't kill her (and I couldn't use the impact grenades, might be a bug). Does anyone know any strategies/methods on defeating bowsette?

kill the shygals and use the dildo bats dual handed to strike her more quickly. Grenades still work but it could be glitched or you might need to recalibrate with the B button. It could also be a play space issue