I'm sure there is a check after the magic phase (before the magic battle phase) and another one after the movement phase (before the battle phase).
So you can remove the breath item and teleport away without problem, but if you move you will drown because movement is after the ritual phase and there between is definitly a check.
I lost one very valuable commander in our faerun game because i accidentally changed the teleport in a normal move order
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The troops should be drown after the battle end (in which your commande died). But not sure here, i think there is another check after the battles.