Me too are bothered about the abuse of the word retreat, when it actually is a strafe attack or raid. It was very rare that an attacker had to retreat, usually when an attack was stopped, both sides dug in and got locked in combat, and the territory got contested, as they say in A&A D day and A&A 1914. Retreating during WWII were usually something the defender had to do. Funny enough, the defender is not allowed to retreat in our A&A game.
In this A&A game an attacker can plan to retreat on purpose, he can plan to attack an enemy territory with just enough infantry fodder to save his hard hitting units, and then retreat after a few rounds of combat, when the enemy only have a few units left. This is a classic strafe, a tactic to bleed the enemy dry. And you dont retreat, you withdraw. Obviously the game designers have less military education.
Another tactic from the days of cavalry is the Raid, you attack from different directions, and withdraw together. The object of this raid can be to surprise the enemy and get him out of balance, annihilate his forces, mess up his strategy, or position your units to a new staging area. Typically raids in A&A Global is slow moving inf and art from Southern Germany that double move via Yugoslavia to Romania as long as a unit from Romania come to meet them. This can make sense since the retreating German army can track supply from many places.
Another, and more cheesy retreat, is to Raid Iraq from Persia and Trans Jordan, and then retreat to Trans Jordan. Lawrence of Arabia did something similar during WW I, but if Egypt and the Mediterranian Sea are hostile, cutting Trans Jordan off from supply, then this raid need to be carefully planed. And there are no longer talk about a retreat. We talk about a campaign, or operation. Not some random retreat because the men panicked.
IMHO the words of the rule should be
1. Attacker press continue attack or withdraw
…and if the attacker withdraw he can split his units to any friendly territories, or seazones that is not hostile, or move them gathered, his choice.
2. Defender press contest the area or retreat.
…and if the defender retreats, his units are scattered and he suffers some penalty.