User blog comment:FairyRaven/Fairy Tail Chapter 314: Erza vs. Kagura, Review and Commentary/@comment-174.54.150.229-20130111234736

I believe that Kagura's blow has connected with Erza, and as a result of this Erza loses the battle. Through out their whole fight Erza was continuously on the defensive and proved to be the inferior combatant. Kagura was also driven by her rage and the belief that the person she wants to kill is Erza. So Erza may very well have died. If Erza dies, it would be completely unexpected and surprising. Lucy said the the future victory would be completely unexpected, and I think a victory where Erza dies is completely unexpected.

Also, I don't think it is in Erza's character to stab Kagura through the heart while she is distracted, nor would she be willing to fight back when she feels responsible for the death of Simon. She probably views Kagura's strike as a form of repentance.

This is my personal take on it, please give feedback if you are interested.

P.S. Personally, I hope Erza lives. She is my favorite character. She CAN'T die.