This “retreat to spaces with unresolved combat” is problematic.
This is for both land and naval combat.
The solution must be universal and easy. The just die thing can be rigged in such a way to kill too many units for nothing.
If pieces remain in combat territories from where they came from and the defender cant retreat because all possible retreats are blocked by various combats, then they should be forced to fight to the death, or held in limbo until all other combats are resolved and only then can retreat or face additional combats.
example: Soviets trapped due to blocked retreat. 1) resolve other combats and retreats first 2) if still no retreat is possible then its a fight to the death.
Thats simple and realistic. This can work for both land and naval.
Naval retreats: must be among the closest route toward your home nation in terms of spaces available.