[Barnacle Bill]

Zanthis covered how it works in Starfire in general. I'll add a bit of detail. Ever since the second generation rules (4th generation was just published back in August), Starfire has used a system in which, for all practical purposes, the entire galaxy is one huge tactical map. If you are moving on the system map and not involved with any enemy forces, including using warp points to move between systems, you are on a system map which is much larger than SE4 but essentially the same concept. If something is going on in multiple systems, you play it out more or less in parallel (set up the map for system A and play out a turn, then set up for system B and play out the turn, etc...). If you enter the same system hex with some enemy, that takes the action to "interception resolution" - new map on different time & distance scale so that the entire interception level map is one hex on the system map. After the number of interception turns has passed to equal one system turn, you pause interception level play and go back to system level to play a turn (so new forces can enter the interception-level battle in progress). If you run off the interception level map, it "floats" (so you don't change the range) but now you are in the adjacent system hex. If you enter the same interception level hex as the enemy, that takes you to the tactical scale, which has the same relationship to the interception level as the interception level has to the system level. So, as stated by Zanthis, you retreat by running far enough away that there is more than one interception hex worth of tactical hexes between you, which gets you back to the interception level.

The retreat proposal that I made earlier (let you declare retreat if you are outside the enemy's weapon range & he lacks the speed to close the range, which puts you in the next sector on the system map and burns on stategic MP) has the same general effect as the Starfire system but it is not quite as detailed or complex. It would also be a lot easier to code than changing SE4 to copy the Starfire system, even if you skipped interception level and just had system & tactical.

To add to DMM's comments, the business of forcing your enemy to split his forces so that you can "defeat him in detail" is a classic element of strategy. This is the only way an inferior force can win, except to stand seige where the defense works & terrain multiply his force and hope the stronger side commits the folly of a frontal assault. Much of the manuevering by Lee in the War of Northern Aggression was conducted with that aim in mind. It is also what the Germans were trying to do at Jutland in WWI. One of the ways classically used to do that is to "put your opponent on the horns of a dilemma", by choosing a line of advance with alternative objectives. For a thorough discussion of this, read the book "Strategy" by B. H. Liddell Hart. Having a game system that allows you to attempt that stuff is a positive, not a negative. It creates something other than a war of attrition to be won by whoever has the biggest fleet.