I think he is trying to ask what the square root calculates or why its used at all

Not what a square root is, heh
"non optimal" defenses are counted only as square root of their value. As opposed to matched defenses.
Here is an example:
Fighter attacks another fighter
Fighter = beam attack of 4, beam defense of 4, missle defense of 4, massdriver defense of 1
The fighter's beam attack (rolled 1-4) is compared against the other fighters defense. The defense is calculated as:
Beam defense = 4 ('optimal or matched' defense)
Missle defense = square root of 4 ('non optimal' defense so it is only counted as square root) = 2
Massdriver defense = 1 square root of = 1
TOTAL defense = 4 + 2 + 1(above) = 7
So the attack of 1-4 is compared against the defense of 1-7.
Thats where the square root is used.
Seems like its beneficial to always have at least a 1 in each defense category since thats probably technologically cheaper than a 3 in any optimal category, no?