They later survived also with help of John. They stopped by a McDonald's later.

Also the "I know where this is going!" part:

James has sword upgrades based on each creature. There was an octopus upgrade too. He later realized that he had the wrong upgrade applied.

The Octopus Chip:

+50% damage against octopus enemies

-50% damage against a Cthulhu

Random crit chance is reduced tremendously