Working with industrial gases most of my adult life, I'd ask, why didn't you keep the system isolated and merely turn it on the system in the event of the power outage? I understand you are using the propane to exercise the generator but maybe you could open/close the main valve in order to exercise the unit? ( Or did you say you use it for a gas stove? )
If the squirrel hadn't eaten your hose, at some point the regulator likely have developed a leak anyway. Some regulators have a bleed hole which will leak through the diaphragm. You could also replace the hose with copper tube or a ss hose. But I will admit, losing 700gals of propane is tough to swallow.