It's an interesting question, and derives from ideas like Musashi's "The warrior is already dead." In the context of an honor/shame society, death is not the issue, but the manner of one's death. Presumably, two peerless Samurai of equal skill would have no choice but to see the duel to its conclusion. But this does suggest an emphasis on death, compared to the Chinese tradition.
Both cultures featured suicide as a form of protest, but Chinese Taoist mythology involves physical immortality.
From the perspective Chinese fencing, and wuxia mythology, two swordsmen of superlative skill would be considered to be evenly matched, such that neither can overcome the other.
(Advanced Chinese fencing is based on the idea of "countering" to gain advantage, as opposed to blocking, but every counter has a counter. This results in a high art form of Chinese fight choreography, originally in Chinese Opera, but now chiefly seen in film. Chinese practice also involves what are typically called "two man sets" which display the range of available techniques.)
In the Chinese classics Romance of The Three Kingdoms, Journey to the West, and Outlaws of the Marsh, there are a staggering number of peerless warriors, and fighting to a draw is a regular feature. (This can often lead to boon friendship per mutual respect, an idea that is as old as Gilgamesh and Enkidu.)
This may also be a reflection of Sun Tzu, where an outcome of mutual annihilation would be avoided unless there is no alternative—the very basis of military strategy, as opposed to rushing in headlong. If avoiding dying oneself by not overextending to strike the enemy is the price for not dying, that is the strategy, except in extreme circumstances. (Wuxia certainly would have examples of sacrificing oneself to kill one's nemesis.)
This idea of mutual annihilation can be found in the Iliad, in that Achilles understands that killing Hector will result in is own death, as prophesied. Thus, it requires an extraordinary circumstance, the death of Patroclus, for him to commit to that outcome. A matter of honor but also a matter of love—vengeance in the context of self-sacrifice.
Homeric Greece was also an honor/shame society, so this comments on the Japanese warrior ideal. Agamemnon annihilates Priam & Troy, but is himself destroyed by what he did to achieve it—his wife murders him for sacrificing their daughter to raise the wind to sail to Troy. Unlike Achilles, the peerless warrior, and Hector, who died for his people, Agamemnon's death is dishonorable.
The Spartan maxim of "Come home with your shield or on it" is a famous historical example of the principle. The Latin form, "morte prima di disonore", survives today in military culture: "Death before dishonor".
Regarding Japanese fencing specifically, the Seven Samurai may actually be instructive here. In the opening, the peerless Samurai fights a duel with wooden swords, and though both contenders display mortal strikes, the peerless Samurai declares that he wins. His opponent demands a rematch with real swords and is cut down.
Since it's been a few hundred years since people killed each other in duels, it's unclear how common was mutual death.
A film that comments directly on ai uchi is The Sword of Doom (aka 大菩薩峠, Dai-bosatsu Tōge, "Great Bodhisattva Pass"). Here, the villain uses an "evil sword style" style the cannot be overcome. The hero is instructed that cannot kill him, and attain vengeance, except with a thrust, with means leaving himself exposed and certain death.
Also consider that mutual death could be a function of both swordsmen being equally unskilled.