As the one who used that trick in the battle report, I don't see a problem with it, it's not like it's an interpretation or bending the rules, it's follows the rules to the letter and is completely legal.
Think about it, if they added "can't strike any blows or be allocated any wounds" then the character would be unkillable if he refused the challenge, you could slaughter the whole unit but you wouldn't be able to hurt him. So how would you "fix" it?
From a "fluff" perspective just because he refused the challenge doesn't mean he can't get hit in the swirling melee if he's in the front rank (B2B).
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Latest Report: BR4: The Repugnant Ramblers Vs Imperial Knights - 1250pts
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