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This half army has an entrenchement level. A bad one yes but it has one.

This other half army nearby cannot merge because it has not the move points to do so. [&:]

But look, the first army can merge into the second one.

And guess what, it can come back to its initial position.

And, of course, it has lost its entrenchement level. So question, why the second army can't move in the first one to keep the first army's entrenchement level then?

Please note that the two armies have 2 move points at the beginning of the turn.

One can do something the other one can't with the same move points.

This is weird.

It has to do with the fact that units can always move 1 hex even if they don't have the OPs to do so, but they cannot merge with a unit unless they do have the OPs. So what is happening is that your 1st Guards Army (the 2-2) cannot merge into the hex containing your Red Banner Army (the 3-2) because this would require 3 OPs. But the 3-2 can merge with the 2-2 since that is only a move of 1 OP. The newly merged First Army (5-1) can move into the hex formerly occupied by the 3-2, even though this costs 3 OPs, because the First Army has not yet moved this turn. Put another way, if instead of merging with the 2-2 your 3-2 Army had moved 2 hexes to another hex, then your 2-2 Army could have moved into the hex formerly occupied by the 3-2.

I agree this is odd. Perhaps it could be changed so that a unit that has not moved can merge into a unit even if this exceeds it OPs. But then that would mean that if the newly merged unit had not yet moved it could still move another hex, even if that move would exceed its OPs. So effectively the one unit would get 2 moves that exceed its OPs. So I like it better this way.

As an aside, your Red Banner Army did not have any entrenchment as its entrenchment is grayed out. But I believe that a unit that does not move gains one entrenchment level at the end of its turn. So if it didn't move it should have gained one level before the Axis turn.

Finally (and you probably know this) when you merged those 2 particular units they ended up with the lowest tech level (39) of the 2 units. So ideally you should only merge untis of the same tech level. But I admit that in emergencies I have broken this Rule myself.

OR merge could be allowed at one hex distance if the unit has not yet moved. BUT once a unit is merge, the new unit is losing all its OPs.

It should be. I will investigate. As long as the unit hasn't moved it should be able to merge 1 hex