Well, I was actually suggesting merging of broken veteran units in preference to using retraining to get them back to full strength but what you can actualy do is merge first, to get one back to full strength (plus a few leftover men) and then send it home for retraining where, in fact, they will just be re-equipped, without harm to their valour average.
The downside to retraining is that it can be a long round-trip (years) to get to the province which has the required training/upgrading facilities and then back to the frontline. Additionally, some units can only be trained in one specific province (e.g. Gallowglass/Highland Clansmen) and a naval blockade just delays the trips even further. They may be of more practical use by staying where they are and making do without the equipment upgrades.
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