IMHO shattered retreat is a great mechanic. IRL the army is broken up and running away, but in at least some sort of semi-cohesive state, ie at least they are all running in the same direction. If you can catch them, say with faster units then you can kill them, otherwise they run far enough away to reform and come back, maybe with reinforcements or more allies.
WAI.
In my current campaign as Duke of Lombardy I was sieging Brescia (sp?) and kept a small force in the Brenner pass to warn me of any armies approaching from the north. The enemy duly showed up and kicked its ass, it then decided to run away THROUGH the pass to join me in Brescia. That seemed so realistic to me !