I don't think they respawn (they're set-piece programmed encounters, not random ones). However, there are something like 4 Death Lords or their equivalents in the game, each of whom drop a Giant Sword. As to whether it's the "best" weapon for a fighter -- well, obviously your character has to be a Mook, and you have to be willing to use a two-handed weapon (yes, it's two handed!), giving up shield or dual weapon use. I really like the Giant Sword because of its extended range, and the fact that it's always there (unlike certain more random drops...). Still, stylistically, I personally wouldn't go creating an all-Mook party just so I could use them...
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