What the means is that you must NOT accept a challenge if you expect to get slaughtered, if you think that your unit would perform better for some reason (maybe due to it's proximity to some magical effect) than your character alone.
Conversely, the overkill rule means that it's great to have a rock hard character in a unit to force puny units with puny champions to rout more quickly *
note: units do not benefit from 'overkilling' a character in the normal course of rank and file combat. They must be engaged in a challenge for overkill to be carried over into the unit's combat resolution.