Nordqvist leads strong Swedish contingent into LPGA Match-Play weekend
Nordqvist found the hazard at the 18th, but limited the damage to a bogey and gained the split as Lee also took bogey.
"I knew I couldn't let up and I had to do my best," said Nordqvist, whose impeccable match play credentials include four Solheim Cup titles with Europe.
"She made a great birdie on 15. I don't know how she got that ball to stop. I thought I hit a good shot and I was way over the green.
"Going down the last thought I hit a great drive and got very unlucky there. Or I don't know if it was better if it was in the water or ended up where it did, but I really had no shot. I tried to go at it, but couldn't fall forward because I'll be in the water swimming right now.
"But a great five, and just a very tough hole location with the downwind, so I'm very happy with a tie today to move on."
Nordqvist will face Switzerland's Albane Valenzuela, who completed a perfect 3-0 round-robin with a 4&3 victory over Lauren Hartlage.
Valenzuela advanced ahead of group rival Lilia Vu, the tournament's top seed and at fourth in the world the highest-ranked player in the field.
Sweden's Maja Stark and Linn Grant also advanced. Stark finished group play 3-0 after a 3&2 victory over Jodi Ewart Shadoff - but that doesn't mean the 23-year-old is feeling comfortable with the format.
"This is awful," Stark said. "Match play is so hard."
Stark will face last year's runner-up, Ayaka Furue of Japan, who beat scotland's Gemma Dryburgh 3&2.
Grant beat defending champion Ji Eun-hee of South Korea 2&1 and will face Ecuador's Daniela Darquea, a 2&1 winner over American Lucy Li.
Thailand's Pajaree Anannarukarn worked overtime to capture the final round of 16 spot, winning the first playoff hole against Karis Davidson after the Australian had beaten her 4&3 - which left them tied on two points apiece atop their group.
Pajaree will play Cheyenne Knight, whose birdie to win the 18th hole gave her the tie she needed against South Korean Kim Sei-young.
American Sophia Schubert advanced with a 4&3 win over South Korean Hong Yae-eun, her two and a half points from group play enough to move on ahead of major champions Brooke Henderson and Lee Jeong-eun.
France's Perrine Delacour and Celine Boutier both advanced. Delacour beat American Caroline Inglis 3&2. The two were tied through 11 holes, but Delacour won the 12th, 15th and 16th to polish off the win and set up a meeting with Ireland's Leona Maguire.
Maguire beat South Korean An Na-rin 5&3.
Boutier never trailed on the way to a 5&3 victory over South African Paula Reto, lining up a meeting with Angel Yin, who beat American Ally Ewing 2&1.
Spain's Carlota Ciganda won her third straight, 5&3 over Mexico's Gaby Lopez. She'll play Alison Lee, who beat fellow American Danielle Kang 3&1.
