Yes, you could have both ideas in the same product: it retains some functionality as it fails, but it fails in a planned way to ensure it's lifespan is short enough.
And oddly, the example of the flashlight isn’t even an example of either. Support for heterogeneous batteries is a feature, but it’s a stretch to call it “degradation”. It’s not like batteries fail randomly before they run out of juice.
For example graceful degradation could be considered when a device can have different components fail but the rest still work.
Progressive enhancement can be considered to be a device with basic functionality with optional add-ons.
It's basically about the base getting less functional, versus the baseline being upgraded. From a certain point of view they are the same thing but realistically they're not.
If I have a device with an optional add-on and I don't actually have that add-on installed, I wouldn't say the device is "degraded", even though technologically it probably doesn't make much difference.