The plan was simple.
When Klaus appears, Danny challenges him, and they know Klaus will accept. Then, after the outcome is determined, Lily will start the group battle by landing a surprise attack.
This, too, was within calculation, considering they knew she wouldn't be able to land that attack. But Lucy, who came up with the plan, put that into consideration as well.
He knew Klaus wouldn't hurt Lily, but he also knew he would not go easy on her. That was where Hanna came into play.
She would attack with Lucy's help, which had a 70% chance of making him fall for that coordinated attack. All this was well calculated by Lucy, who is the brains of the team.
But they never took into account Klaus swapping places with Hanna. This destroyed the plan.
However, there was another plan where Lulu would use her soul-attacking abilities to cause soul disturbance, allowing Nia to slip behind Klaus and attack.
This also had a 60% chance of working.