Think about it for a second. Considering that falling horse.
It wouldn't fall on 20 people if it had been just running past. It was gunning for them. And while horses can stop relatively fast, the depth of it's penetration does not allow for that. It was at that point all or nothing. In this case it become all and nothing at the same time. Had it been shot at a distance where it could have halted it wouldn't have hit that many people. It was a flying piece of dead meat more or less, not the stumbling mass we often see in movies (because that indicates it's stopping up, again limiting it's impact). When horses fall they tend to fall for a relatively short distance. Anyone that has seen the horrible racecrashes know they don't roll a long distance. It had to be very close to either directly fall through, or to rear up and stagger the last few steps into the formation (and then hit no less then 20 people).
However you look at it the horse was going at full strength at the square, not the center, but at a mass of men no less. It died or was so fatally wounded that it fell through the formation. Had it been weering off it would once again have been done at a disance where you can actually move away from the unit.
But the specific case of the Bouvines does not fit the "oh no our troops broke" since the French king and his unit of knights charged headlong into a unit of polearm armed city militia (not to be discounted as they were actually the center of the allied line). The charge carried them deep but the militia held on despite heavy losses and eventually cut the horse from underneath the French king. He was then saved by his knights and infantry. Had it been a case of not carrying out the charge the French would have pulled back (for another try or repositioning to a better theater of the battlefield) and not get enveloped by superior numbers with long weapons. Getting stuck has always been a problem for cavalry, even heavy knights. And while their horses were trained to keep infantry at bay (the Spanish Riding School in Vienna use many melee range horse 'tactics' in thier displays), it was not a good position unless the enemy was weak or about to break.
Also, if we go further back the Roman legionaries fought off cataphracts from Parthia on numerous ocations, and we know they didn't exactly have weapons that were particularly good for anticavalry. Yet the catapracts tended to suffer rather unpleasant losses. Losses that could come from two sources, pila volleys or melee. The first is definately possible but we also know the tactic was to not use them in a ranged fashion when confronted by charging cavalry. So that leaves us melee.
The chariots the romans defeated by formation were the British ones, light and unarmed. They were a pure scarefactor, and partially a battlefield taxi with the added benefit of a good position for attacking when and if the enemy break up. If they didn't break up the chariot was not great.
When the Romans faced the eastern heavy chariots those were defeated by ranged means, not any formation.
Just like you say it is myth that cavalry could charge it is equally a myth that it couldn't perpetuated by officers in the 18th and 19th century (the same people that has been so utterly discounted on the matter of the stirrup being essential for charging), which did see the decline of cavalry as an effective force. Unlike you believe the square was effective, not because it presented a solid mass, any unit in a line could do that effectively, but because it presented no ways of getting close without getting disrupted.
If horses couldn't charge a solid unit then the timing of the fire fro mthe square would be rather pointless since it was free to fire at will with no risk of the enemy cavalry getting in. Similarly if the cavalry only had the hope that a square would break through nerves, then spending an awful lot of time trying to get them to fire early would be equally pointless as either the charge would scare them enough, or it wouldn't. And definately after a single rush that failed it would be ever more unlikely that a square would fail through mock charges, so why continue. People weren't any more stupid than we are now.
As Furious Mental says, the timing of the volley was the important part. Not so much for any losses it caused (though over time they would of course mount up), but because cavalry has always been notoriously fickle to disruptions. If a few horses fall in the first line then the next horses and riders try to avoid them to not risk falling themselves, some might even fall over them. Any cohesion is broken and the cavalry break off the charge and swirl around to attack the other sides. In a line the ends couldn't disrupt enough and the rear was often 'unguarded'. I believe there was a rear charge at Waterloo on a unit. Front or back a unit is equally solid.
Besides, there are always two sides to the same coin. We generally disregard the French sources of the battle because, well they were the losers and in a time where historical accuracy wasn't always very important over things such as national pride and morale. The winners write history, especially at that time. And there wasn't much French will to dispute it afterwards due to the new regime set up by the allies. All the sources that claim no broken square are British. We should not forget that any claim we lay on a side in terms of accuracy applies equally to the other. In this case it just not terribly beautiful nor very attractive to most people as it removes the picture of the gallant squares withstanding charge after charge.
History is full of these little omissions. Like apparently it is forgotten that Saxon curassiers broke two Austrian squares at Dresden. How they did it I don't know, though I must admit a certain number of other squares eventually surrendered when surrounded (but that seems destinctly different since that was from an amalgation of units closing in on them).
For instance General Delort of the curassiers at Waterloo claim: "several squares were broken." And a certain private in the curassier arm wrote in his letters that he charged a square three times finally riding it down (E. Tattet - “Lettres du brigadier Pilloy ...” in Carnet de la Sabretache, Vol 15th, if you want to look it up). In specific it says 'through' the square, meaning the square was standing, but was overwhelmed.
The truth is in this case not easy to find out as there is a general lack of French sources, so we have to rely on onesided accounts in general. Even as late as the Vietnam War this has proven to be highly unreliable. Why should it be any less for Waterloo? That the official results for Waterloo state that the French suffered much heavier losses than the allies ssems to underline this when the French lost just above 200 officers (dead and later dead from wounds) to the combined allied 270 officers indicates that the official numbers might not be entirely reliable (being onesided this is not surprising).
The end result doesn't change however, several squares broken or not, the French expended their cavalry and strength at the wrong time (but not so wrong that it was a clearcut deal for the remainder of the battle).
I'm no Napoleon fan, in fact I think he was/is slightly overplayed as a general, but this is getting off topic.
*phiew* that was a lot.
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