I just checked, Guard mode is on by default. I never really noticed, to change it. That means I have always fought with it on. I never switched it off for my units.
What that means for me on normal diff, normal size units, based on my success I have no idea. They do fight, I have seen it, they do fight organized, in Phalanx formation, they do kill the enemy, I seen it. The fact I have always had it on, I have no idea what that means.
Would they be more effective with it off, I have no idea, they are pretty effective as it is. Lately I just finished off Roman factions, many with +exp.
Now that I think about it, I cant really see a reason for it being on, since I have been mostly attacking. Maybe they would be less likely to engage in sword, and more flexible with their Phalanx formation, but I am grasping. Like I said, sword only seems to occur when heavily invested or flanked with a few units with guard on.
I learned another new thing, lol, after spending 20+ hours playing Macedonia, lol, apparently you can disable Phalanx formation, go to loose, then back to Phalanx and have a loose, wider, Phalanx formation which I am embarassed to admit.
I am kinda under the impression Guard mode reduces attack chance, damage output (something/trade off), but increases defense rating. Pure guess. With Roman Faction I never had guard mode on, unless in certain situations on defensive, never attacking.
Perhaps my Phalanx units would be even more effective with guard mode off. I will have to see.
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