by Hermjard
Thank you for submitting this question to Corey! I am curious, what he will answer! :)Btw, the rules of the revised edition state on p. 21 about retreats:
"Units routed during the current battle can retreat (this is an exception to the rule that routed figures cannot move)."
From what I can see, it is exactly vise versa from what you say. That routed units can retreat although they are routed, seems to be the exception, and not the regular.
This sentence of the rules implies, that in all other cases, where routed figures are forced to move, they must be eliminated. Note also, that the quotation above speaks about figures, not only units. This includes all kinds of heroes.
The quotation above explicitely speaks about battles. Diplomacy are not battles. So, a retreat of friendly units (and commanders because they move like units) because of failed diplomacy must be one of these regular cases, where routed units CANNOT move.