In my battles against the Yor last night, I was facing Frigates with ~150 missile attack and zero defence. My small's could post about 30 attack. If I sent a fleet of 5 smalls against a lone frigate, it will destroy the frigate with one or two smalls remaining.

If I send the small ships one at a time, the first small would bring the frigate down to about 7 hitpoints. After the next attack, the frigate would not only survive but be back up to full hitpoints!

I understand there may be some rule that prevents mutual annihilation. If you ask me, that rule isn't justified, but that's besides the point. Even if there is a rule that one of the fleets should survive with one hitpoint, there's no way that being attacked should reset your hitpoints to max!