8th Ed. Life Lore Attribute, Limitations of it

"When a spell from the Lore of LIfe is successfully cast, the Wizard (or another frienldy model within 12" instantly recovers a single Wound lost earlier in battle."

There's little question in my mind if this can heal a wounded Kroxigor, Salamander or character near the Slann. What I am unsure of is whether you bring back a fallen Saurus or Skink from a nearby block that has taken casualties.

I thought Lifebloom only worked on living multi-wound models but my opponent said it works on anything Regrowth does. I didn't argue it at the time because that was in my favor. Before that game I played it such that I could only use Lifebloom to heal living multi-wound models.

I'm using LIfe oftne in a campaign I'm playing. I neither want to give myself an unfair nor do I want to cheat myself out an advantage that I am due.

Regrowth and the life attribute are similar but have different limitations. Only the spell regrowth allows models that have been removed to be brought back since the spell targets a unit and specifically addresses how models are brought back to life. The lore attribute only affects a "single model" (see its description) and thus it can only heal a wound on a multi wound model, including characters and their mounts. That being the case, your first interpretation was correct so I would continue using lifebloom only to heal multi-wound models in the campaign since it cannot bring models back from the dead.