They graphically lose guys, but the (reported) strength does not change, and it doesn't feel like the damage is reduced; I've seen squads with 1/2 men left still deal out very high amounts of damage quite regularly.
And it does not seem like squads work as discussed here in terms of combining their strength.
If I understand combat correctly (and maybe I don't, but performance seems consistent with this, though I have not labbed anything thoroughly):
Consider 2 solo units. Each one is strength 4/2. One attacks the other. It does Max{ RAND[0,1,2,3,4,5] - RAND[0,1,2], 0} where each outcome is equally likely to be selected. So for example, there are 15 possible "combinations";
0 and 0, 1, 2 => miss
1 and 1,2 -> miss
1 and 0 -> 1 damage
2 and 0 -> 2 damage
2 and 1 -> 1 damage
2 and 2 -> miss
3 and 0 -> 3 damage
3 and 1 -> 2 damage
... etc
Or something similar. [Maybe the defense is not RAND[0,1,2] but is instead just 2, if it is of the appropriate type to the attacker's weapon.]
Now suppose that instead of a solo unit, there is a party of three 4/2 units.
My understanding of what happens now, is that this is the same as a 12/6 unit.
If it attacks a unit with 2 defense, then it does RAND[0,1,2,3,....,11,12] - RAND[0,1,2]
Whereas what it *should* be doing in my opinion is something more like Max{ RAND[0,1,2,3,4,5] - RAND[0,1,2], 0} + Max{ RAND[0,1,2,3,4,5] - RAND[0,1,2], 0} + Max{ RAND[0,1,2,3,4,5] - RAND[0,1,2], 0}
Or: Max{ RAND[0,1,2,3,4,5] +RAND[0,1,2,3,4,5] + RAND[0,1,2,3,4,5] - RAND[0,1,2] - RAND[0,1,2] - RAND[0,1,2], 0}
These have very different probability distributions over outcomes.
Its entirely possible that I'm wrong here - I haven't seen the code. Maybe the problem is just that attack levels are too high relative to hit points.
But whatever the case, damage levels are incredibly high, and most of the time units are wiped out in a single attack. So tactical combat is a joke, because the AI advances its units up to mine, and then I attack their unit and kill it in a single blow. I've often seen squads units that are 90/12 (ie 6x15/2), and I kill them in a single blow with my much less expensive ~60 attack unit, doing ~40+ damage in a single hit.
But in any case, I never take *any* damage from the AI at all unless they have archers.
