IOS – Does Whatsapp Save Incoming Media feature create duplicates

Apple apparently didn't realise just how many photos people were going to want to keep online, so they've dramatically reduced the retention.
If you want to keep photos, don't keep them on iCloud, keep them on your computer.

No, iOS can't delete your WhatsApp account. iOS can't, on its own, delete any account for any app.

You stated you didn't have Offload Unused App enabled so it's more probable that WhatsApp didn't have the available space it needed to store your history.

iOS will determine if it needs to 'unload' an app from memory to make space for system process, another app's use, etc. I can't say for sure but it appears that WhatsApp was removed from memory because the system needed to reclaim that memory to use for something else.

If you delete apps you don't need, turn on Offload Unused Apps, and then reinstall WhatsApp, you might see your history return. This answer from a similar question might help, too. That user stopped all apps using the app switcher and then restarted their iPhone. That helped them regain space and add their apps back.