[Quikngruvn]

"Break formation" is almost always better than holding formation, because of the aforemetioned problem with ships flying out of range of enemy ships to hold the formation. But, I can think of one exception, in the case of Capture Planet.

Say you have a fleet with mostly warships and a troop transport (with troops on it, naturally). The way the strategies are set up by default, the warships will pound the planet to smithereens before the troop transport will get there. So, I've changed 'Capture Planet' to (a) thwack enemies till all weapons are gone, and (b) dole out less than 100% damage on the planet. But, if the ships were set to break formation, the warships would revert back to the ship designs' default planet-pounding strategy. If the ships do not break formation from a fleet set to Capture Planet, the warships shouldn't eradicate the planet before the troop transport gets there. (At least that's been my experience.)

Tangential question: if a ship is set to break formation from a fleet, does it still get the fleet's experience bonus?

Quikngruvn