diff --git a/src/scripts/download-avatar-models.sh b/src/scripts/download-avatar-models.sh
index 688e3d89e..58ce926b3 100755
--- a/src/scripts/download-avatar-models.sh
+++ b/src/scripts/download-avatar-models.sh
@@ -7,8 +7,18 @@
 #   - 100Avatars by Polygonal Mind (Arweave) — low-poly stylized, CC0
 #
 # Called automatically by npm start if models don't exist
-
-set -e
+#
+# Failure policy (continuum#1087): per-VRM download failure is NON-FATAL.
+# Third-party CDN flakes (OpenGameArt has been observed returning curl exit 11
+# = CURLE_FTP_WEIRD_PASS_REPLY) must NOT block the model-init container from
+# completing — every other model in the chain (Qwen, voice, embeddings) has
+# already downloaded by the time this script runs, and a partial-avatar set is
+# strictly better than blocking the install. Each per-VRM failure logs a
+# structured warning so the operator sees the actual exit code (Joel's "never
+# swallow errors" rule); the run summary at the end reports failed-vs-total
+# count, but the script returns 0 so the model-init container is healthy.
+
+set -eu  # NOTE: no pipefail and no -e on the per-VRM curl/extract calls
 
 SCRIPT_DIR="$(cd "$(dirname "${BASH_SOURCE[0]}")" && pwd)"
 source "$SCRIPT_DIR/shared/preflight.sh"
@@ -17,9 +27,11 @@ source "$SCRIPT_DIR/shared/preflight.sh"
 MODELS_DIR="${MODELS_DIR:-models}/avatars"
 mkdir -p "$MODELS_DIR"
 
-# Track how many we download vs already have
+# Track how many we download vs already have vs failed
 DOWNLOADED=0
 EXISTING=0
+FAILED=0
+FAILED_NAMES=()
 
 download_vrm() {
   local name="$1"
@@ -32,17 +44,28 @@ download_vrm() {
   fi
 
   echo -e "  ${YELLOW}Downloading ${name}...${NC}"
+  # set +e for the curl/wget call: per-VRM failure is non-fatal (continuum#1087).
+  # Capture the exit code so we can log it — never swallow silently.
+  local curl_ec=0
   if command -v curl &> /dev/null; then
+    set +e
     curl -sL --progress-bar -o "$dest" "$url"
+    curl_ec=$?
+    set -e
   elif command -v wget &> /dev/null; then
+    set +e
     wget -q --show-progress -O "$dest" "$url"
+    curl_ec=$?
+    set -e
   fi
 
   if [ -f "$dest" ] && [ "$(wc -c < "$dest")" -gt 10000 ]; then
     DOWNLOADED=$((DOWNLOADED + 1))
   else
-    echo -e "  ${RED}Failed to download ${name}${NC}"
+    echo -e "  ${RED}⚠ Failed to download ${name} (curl exit ${curl_ec}, source: ${url}) — continuing${NC}" >&2
     rm -f "$dest"
+    FAILED=$((FAILED + 1))
+    FAILED_NAMES+=("$name")
   fi
 }
 
@@ -57,21 +80,44 @@ download_vroid_zip() {
     return
   fi
 
-  local tmpzip=$(mktemp /tmp/vrm_XXXXXX.zip)
-  local tmpdir=$(mktemp -d /tmp/vrm_extract_XXXXXX)
+  local tmpzip
+  tmpzip=$(mktemp /tmp/vrm_XXXXXX.zip)
+  local tmpdir
+  tmpdir=$(mktemp -d /tmp/vrm_extract_XXXXXX)
 
   echo -e "  ${YELLOW}Downloading ${name} (zip)...${NC}"
+  # set +e for curl: per-VRM failure non-fatal (continuum#1087). OpenGameArt has
+  # been observed returning curl exit 11 (CURLE_FTP_WEIRD_PASS_REPLY) on this
+  # endpoint; capture the code, log it, move on.
+  local curl_ec=0
   if command -v curl &> /dev/null; then
+    set +e
     curl -sL --progress-bar -o "$tmpzip" "$url"
+    curl_ec=$?
+    set -e
   elif command -v wget &> /dev/null; then
+    set +e
     wget -q --show-progress -O "$tmpzip" "$url"
+    curl_ec=$?
+    set -e
+  fi
+
+  if [ "$curl_ec" -ne 0 ]; then
+    echo -e "  ${RED}⚠ Download failed for ${name} (curl exit ${curl_ec}, source: ${url}) — continuing${NC}" >&2
+    rm -rf "$tmpzip" "$tmpdir"
+    FAILED=$((FAILED + 1))
+    FAILED_NAMES+=("$name")
+    return
   fi
 
   # Verify download is a valid zip (must be > 10KB and start with PK signature)
-  local filesize=$(wc -c < "$tmpzip" 2>/dev/null || echo 0)
+  local filesize
+  filesize=$(wc -c < "$tmpzip" 2>/dev/null || echo 0)
   if [ "$filesize" -lt 10000 ]; then
-    echo -e "  ${RED}Downloaded file too small (${filesize} bytes) for ${name} — likely a 404 or empty response${NC}"
+    echo -e "  ${RED}⚠ Downloaded file too small (${filesize} bytes) for ${name} — likely a 404 or empty response${NC}" >&2
     rm -rf "$tmpzip" "$tmpdir"
+    FAILED=$((FAILED + 1))
+    FAILED_NAMES+=("$name")
     return
   fi
 
@@ -85,17 +131,22 @@ except (zipfile.BadZipFile, Exception) as e:
     print(f'Extract failed: {e}', file=sys.stderr)
     sys.exit(1)
 "; then
-    echo -e "  ${RED}Failed to extract ${name}: file may be corrupt or not a zip${NC}"
+    echo -e "  ${RED}⚠ Failed to extract ${name}: file may be corrupt or not a zip${NC}" >&2
     rm -rf "$tmpzip" "$tmpdir"
+    FAILED=$((FAILED + 1))
+    FAILED_NAMES+=("$name")
     return
   fi
-  local vrm_file=$(find "$tmpdir" -iname "*.vrm" -type f | head -1)
+  local vrm_file
+  vrm_file=$(find "$tmpdir" -iname "*.vrm" -type f | head -1)
 
   if [ -n "$vrm_file" ] && [ -f "$vrm_file" ]; then
     mv "$vrm_file" "$dest"
     DOWNLOADED=$((DOWNLOADED + 1))
   else
-    echo -e "  ${RED}No .vrm found in ${name} zip${NC}"
+    echo -e "  ${RED}⚠ No .vrm found in ${name} zip — continuing${NC}" >&2
+    FAILED=$((FAILED + 1))
+    FAILED_NAMES+=("$name")
   fi
 
   rm -rf "$tmpzip" "$tmpdir"
@@ -142,10 +193,25 @@ download_vroid_zip "vroid-sample-f" \
 # ============================================================================
 
 TOTAL=$((DOWNLOADED + EXISTING))
-if [ "$DOWNLOADED" -gt 0 ]; then
-  echo -e "${GREEN}Avatar models: ${DOWNLOADED} downloaded, ${EXISTING} already existed (${TOTAL}/8 total)${NC}"
-elif [ "$EXISTING" -eq 8 ]; then
-  echo -e "${GREEN}All 8 avatar models already exist${NC}"
+EXPECTED=8
+if [ "$FAILED" -gt 0 ]; then
+  # Degraded summary — script still returns 0 (continuum#1087) so model-init
+  # container is healthy, but the operator sees exactly which avatars failed.
+  echo -e "${YELLOW}━━ avatar download DEGRADED — ${FAILED} of ${EXPECTED} failed ━━${NC}" >&2
+  echo -e "${YELLOW}  failed: ${FAILED_NAMES[*]}${NC}" >&2
+  echo -e "${YELLOW}  succeeded: ${TOTAL}/${EXPECTED} (downloaded=${DOWNLOADED}, cached=${EXISTING})${NC}" >&2
+  echo -e "${YELLOW}  cause is upstream (CDN flake / 404 / rate limit) — not a Continuum bug${NC}" >&2
+  echo -e "${YELLOW}  re-run: docker compose run model-init    (or: ./scripts/download-avatar-models.sh)${NC}" >&2
+elif [ "$DOWNLOADED" -gt 0 ]; then
+  echo -e "${GREEN}Avatar models: ${DOWNLOADED} downloaded, ${EXISTING} already existed (${TOTAL}/${EXPECTED} total)${NC}"
+elif [ "$EXISTING" -eq "$EXPECTED" ]; then
+  echo -e "${GREEN}All ${EXPECTED} avatar models already exist${NC}"
 else
-  echo -e "${YELLOW}Avatar models: ${TOTAL}/8 present${NC}"
+  echo -e "${YELLOW}Avatar models: ${TOTAL}/${EXPECTED} present${NC}"
 fi
+
+# Always exit 0 (continuum#1087): partial avatar set is acceptable; downstream
+# (Bevy live mode) gracefully degrades to whatever VRMs are present. Failing
+# the model-init container blocks the whole install for a third-party CDN
+# blip — that trade is wrong. The summary above carries the diagnostic.
+exit 0