I wonder if this formation variant was discussed here earlier.
The square formation is already covered in the rules, but why not extended line or column formations. These could easily be visually represented on the board by placing the units in a certain way. For example all blocks in a unit next to one another for extended line and all blocks one after the other for a column.
The formations then have certain benefits and drawbacks. An extended line has more firepower but less maneuverability. A column has better maneuverability and maybe speed but are more vulnerable to artillery.
Maybe even skirmishing can be handled in some way.
I have thought about this as well (and in fact, I like to arrange my infantry units according to my "role-playing" formation at any given time).
In the end, I ended up concluding that the rules already capture this dynamic pretty well without the need for extra complexity: It's all in the difference of combat dice when moving as compared to when standing still. In my view, this captures the fact that an infantry unit would move in column and then redeploy in line for firing action. To my understanding, this is pretty accurate, since units rarely moved forward in line (at least on the scale that I imagine the typical CCN battlefield to be).
The better trained the unit (French vs Portuguese for instance), the smaller the (dice reduction) penalty of this demanding redeployment.
So in my opinion, there is no real needed for extra formation rules that would make the game system less elegant.
You might have a point regarding skirmishing, but as it is now, Light Infantry's ability to move into forest and fire on the same turn is a pretty neat bonus (which surely models their ability to adopt a loose formation). And then there is of course the Light Infantry Skirmish tactician card.
in the end, what I really like about the C&C games is how much they capture through simple and sometimes slightly abstract rules. When I first tried CCA I could not understand that there was no specific "flanking rule" until I discovered how cleverly that is modelled through the need for support and the presence of flags on the dice. That's just my thoughts of course and surely there's nothing in the way of a more comprehensive variant with formation house rules