RE: How much tracking is ethical
As far as effort I personally believe you put forth more effort than most ever would. Other than getting a group doing a slow grid search, with no real sign you were in tough and had few options. Did you notice any birds the next day? Here they will be on a carcass very quickly, the mags and ravens really show the path to a kill! With a tail up, she wasn't hit real at least in my experience if they are hurt that tail is down. What about head position, was it up and alert like a normal deer running, or was it down or cocked straight...usually the upright alert head position also means a poor hit or miss. Without being their it is tough to say what happened and really just a guess at best but if you found specs of blood at the shot location he could have just nicked her low or something casuing a small flesh wound, being the tail was up and she covered a fair distance without leaving any other clues.
We all make mistakes unfortunately that is part of the learning curve.