[General Hawkwing]

The main problem with the "no borders" idea is that, when you engage an enemy in open space you start at opposite sides of the map. Two forces with matching speed would never engage. This would defeat the basic reason for the combat starting, one fleet setting out to intercept the other. Making the combat area somewhat larger would help the retreating ship but if you do increase the size, you would need to keep the same starting distance. I believe that the suggestion to only allow retreat via the opposite starting side would be the most "fair" and easiest solution. I also feel that no retreat should be allowed at warp points if the combat is taking place in the warp point, if it is in the space around the warp point then retreat would be possible.
I also believe that at warp points and planets, that the non-moving force (most likely the defender) should have the first combat turn. At warp points, this would usually ensure at least 1 attack by the stationary force. As it is now, I can use my first turn to move out of range of the enemy, before his sat's can fire.
It also is makes little sense to eliminate all remaining movement from the retreating force, when you attack someone you still have movement left. If you manage to avoid combat/destruction you still have movement left. Why is retreating any different? Forcing retreating ships to go back to their previous square is also unrealistic, space is 3D afterall.
The current system is fair, albeit somewhat unrealistic(it's about as realistic as time manipulation or colonizing various worlds without regard to their size and therefore gravitional effect on the people). It is the only way to enforce you borders within the current game structure. Imagine with me for just a moment. You border fleet engages 5 colony ships of the enemy, the 5 manage to run past the you, and head in 5 directions. You split 5 ships to chase them down, before they can colonize and deploy a minefield around the colony. Once the chase is on, the enemy sends in a force that clears the remaining border fleet and heads for your worlds. (In the current system, you would have crushed the colony ships and had a full force waiting for the enemy fleet.) Now the above scenario sounds good, and makes a good argument for allowing retreat, instead of not allowing it. But the AI would only create the scenario by accident.