Problem: Take a lvl1 4squad (this problem affects all squad #'s, just using 4 as an example) out into battle. If this squad loses just one health, but then gains a level (or more), a problem that occurs is the new level 2/3 squad only has 3 members. At the end of combat, the 4 squad may have 29/30 health, but then it gains a level or two, now the new health is 29/46. Since the units now are 'missing' 17 health, the game determines that at least one whole unit got destroyed in the last battle.
Am I wrong here? Is this a known problem?
Basically I don't go into battle with my squads less that 100% now, and if they have any chance of leveling, I'll make sure that they don't get hit during combat (save/load nightmare).