I agree, Razor. I doubt it was the designers intent, but it works in that it poses a problem for the player. And the more you use beat up units before retraining them, the faster they get experience too. But you risk one routing and being loss when the numbers get really low, or flat getting eliminated.

And swapping out a fresh stack for the vets, sending them back for replacements, can result in nasty surprises if you've gotten used to what those vets can do!